If the Price of a Cola Increased by 12% and Consumers

question 157

Multiple Choice

If the price of a cola increased by 12% and consumers responded by purchasing 24% less cola, the absolute value of price elasticity of demand for cola would be

• A) 0.20.
• B) 1.2.
• C) 2.
• D) 0.5.

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Definitions:

Point Estimate

A single value or statistic that serves as the best guess or most probable value of an unknown population parameter.

Population Parameter

A numerical value that summarizes a characteristic of an entire population.

Random Sampling

A method in statistical analysis where individuals or items are selected from a larger population entirely by chance, ensuring that every member has an equal opportunity of being chosen.

Convenience Sampling

A non-probability sampling method where participants are selected based on their availability and proximity to the researcher.