Suppose That the Price of a Product Increased from $1

question 156

Multiple Choice

Suppose that the price of a product increased from $1.90 to $2.10,and the quantity demanded decreased from 24 to 16.What is the value of the price elasticity of demand?

• A)0.5.
• B)0.58.
• C)1.0.
• D)1.73.
• E)4.0.

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Definitions:

Exact Value

The precise numerical quantity or measurement of an item or variable, often crucial in calculations or analyses.

Bidders

Individuals or entities that offer a price for goods or services, especially at auctions.

Winner's Curse

A phenomenon in auctions where the winner tends to overpay due to incomplete information or overly optimistic valuation of the asset.

Rivals' Information

Data or intelligence about competitors’ strategies, performance, and operations, useful for gaining a competitive advantage in the market.