Demand Is Said to Be Price Elastic at a Point

question 59

Multiple Choice

Demand is said to be price elastic at a point on a demand curve if a

• A)1 percent rise in price reduces the quantity demanded by more than 1 percent.
• B)1 percent rise in price reduces the quantity demanded by less than 1 percent.
• C)1 percent rise in price reduces the quantity demanded by more than 10 percent.
• D)10 percent rise in price reduces the quantity demanded by less than 10 percent.

---

Definitions:

Marginal Cost

The increase in cost resulting from the production of one additional unit of a product.

Demand Elasticity

The measure of how much the quantity demanded of a good or service changes in response to a change in price, indicating the sensitivity of consumers to price changes.

Coffee Mugs

Drinking vessels, typically made of ceramic, used for serving hot beverages such as coffee.

Quantity Sold

The total number of units of a product or service that have been purchased by consumers during a specific period.