If the Demand for a Good Is Unit Elastic, Then

question 62

Multiple Choice

If the demand for a good is unit elastic, then _____.

• A)the percentage increase in revenue is greater than the percentage decrease in price
• B)the percentage increase in revenue is equal to the percentage decrease in price
• C)the percentage change in the quantity demanded is equal to zero
• D)the percentage change in revenue is equal to zero
• E)the percentage increase in revenue is lesser than the percentage decrease in price

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Definitions:

Indifference Curve

A curve that shows consumption bundles that give the consumer the same level of satisfaction

Absolute Price

The price of a good or service without taking inflation or purchasing power into account.

Indifference Curves

A graph showing different bundles of goods between which a consumer is indifferent, pointing out the preferences of the consumer for one combination of goods over another.

Bowed Inward

A description often used in economics to illustrate a production possibility frontier that indicates increasing opportunity costs for producing goods.