Assume That When the Price of Cantaloupes Is $2

question 269

Multiple Choice

Assume that when the price of cantaloupes is $2.50 the demand for cantaloupes is unit-elastic, and that the demand curve for cantaloupes is linear and downward sloping.If firms lower the price of cantaloupes to $2.00 which of the following statements can be made regarding the price elasticity of demand for cantaloupes?

• A)The demand for cantaloupes at $2.00 must be inelastic.
• B)We cannot determine whether the demand for cantaloupes is elastic or inelastic without knowing what the quantity demanded is at each price.
• C)The demand for cantaloupes at $2.00 must be elastic.
• D)The demand for cantaloupes at $2.00 must be unit elastic.

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Definitions:

Placebos

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