If the Absolute Price Elasticity of Demand for a Product

question 407

Multiple Choice

If the absolute price elasticity of demand for a product is less than 1, then

• A) consumers are relatively insensitive to price changes.
• B) consumers are relatively sensitive to price changes.
• C) there is a positive relationship between price changes and total revenue.
• D) producers are relatively insensitive to price changes.

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Definitions:

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Development

The process of economic and social transformation that is based on complex cultural and environmental factors and their interactions.

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An arrangement where persons are held by others, stripped of their individual freedom, and obligated to engage in labor or services.