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:

High Wages

Refers to compensation levels that are significantly above the average for a job or industry, typically in response to skill shortages, high demand, or exceptional performance.

High Productivity

The state of achieving a significant amount of output per unit of input, enhancing efficiency and effectiveness in production or work.

High Earnings

Refers to income levels that are significantly above the average or median for a given demographic or region.

Economic Progress

The overall growth and development of an economy, often marked by an increase in wealth, improvements in the standard of living, and technological advancement.