If the Price of a Good Is Increased by 15

question 63

Multiple Choice

If the price of a good is increased by 15 percent and the quantity demanded changes by 20 percent, then the price elasticity of demand is equal to:

• A) 0.75.
• B) approximately -0.33
• C) approximately -1.33.
• D) -1.

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Definitions:

Low-value Bidders

Participants in an auction or competitive process who offer significantly lower bids compared to others.

Bid-rigging Cartel

A group of firms that illegally coordinate their bids to control market prices and eliminate competition in auctions or tender processes.

Winning Bid

The highest offer made in an auction that secures the purchase of the item or service.

Bidders Values

The subjective valuations that individual bidders assign to the item being auctioned.