Price Elasticity of Demand Is Often Expressed as a Positive

question 17

Multiple Choice

Price elasticity of demand is often expressed as a positive number because:

• A)using the formula yields a positive number.
• B)demand has a positive slope.
• C)it's convenient to use absolute values even though the formula yields non-positive numbers.
• D)both the numerator and the denominator in the formula are negative.

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Definitions:

Productive Efficiency

A situation where goods or services are produced at the lowest possible cost, utilizing resources in the best way possible without waste.

Equilibrium Price

The price at which the quantity of goods demanded is equal to the quantity of goods supplied, resulting in a stable market condition.

Surpluses

Surpluses occur when the quantity of a good or service supplied exceeds the quantity demanded, often leading to a decrease in prices.

Market Prices

The current prices at which goods and services can be bought or sold in a marketplace.