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If the Price Elasticity of Demand for a Normal Good

question 50

True/False

If the price elasticity of demand for a normal good is constant, then a price increase of 10A2 will reduce demand by more if the original price is $1 than if the original price is $2.


Definitions:

Primacy Effect

The inclination to recall data presented at the start of a list more effectively than the subsequent information.

Recency Effect

Tendency to remember information at the end of a body of information better than the information that precedes it.

Group Think

The behavior seen in groups when the urge for peace or uniformity brings about decisions that are improper or not functional.

Critical Evaluation

The process of examining an issue or object critically to form an opinion or judgment after considering its strengths and weaknesses.

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