Suppose That the Value of the Price Elasticity of Demand

question 173

Multiple Choice

Suppose that the value of the price elasticity of demand for a product is 0.5 and its price decreases by 10%.What will happen to the quantity demanded?

• A)It will increase by 5%.
• B)It will increase by 20%.
• C)It will decrease by 5%.
• D)It will decrease by 20%.
• E)It cannot be determined without further information.

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Definitions:

Transfer

The act of moving money or goods from one place, account, or person to another.

Classified by Purpose

A method of grouping or categorizing items according to their intended use or role within a system or process.

Profit

The financial gain achieved when the revenues generated from business activities exceed the expenses, costs, and taxes needed to sustain those activities.

Not-for-Profit

An organization that operates for purposes other than making a profit, often focusing on social, educational, or charitable activities.