If the Absolute Price Elasticity of Demand Is 2

question 18

Multiple Choice

If the absolute price elasticity of demand is 2.5, a 10 percent increase in the price will cause

• A) the quantity demanded to decrease by 2.5 percent.
• B) the quantity demanded to decrease by 25 percent.
• C) the quantity demanded to decrease by 4 percent.
• D) the quantity demanded to decrease by 40 percent.

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Definitions:

Stressful Events

Situations or occurrences that cause tension, anxiety, or strain to an individual.

Information Technology

The use of electronic equipment and software to store, retrieve, transmit, and manipulate data, usually in the context of business or enterprise.

Information Overload

A condition in which the volume of information received exceeds the individual's ability to process it.

Organizational Flexibility

The ability of an organization to adapt quickly to changes in the environment, markets, technology, and customer needs.