Which of the Following Observations Is True of Price Elasticity

question 58

Multiple Choice

Which of the following observations is true of price elasticity?

• A)Price elasticity is only affected by demographic factors,not psychological factors.
• B)Price elasticity is a measure of consumers' price sensitivity.
• C)The estimation of price elasticity from historical data is an expensive approach and is not limited to the consideration of price changes.
• D)Crude estimates of price elasticity are not useful to pricing decisions.

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Definitions:

Height of the Curve

In statistics, this typically refers to the peak point of a probability distribution curve, indicating the most probable outcome.

Continuous Random Variable

A type of random variable that can take an infinite number of possible values within a given range.

Normal Distribution

Refers to a probability distribution that is symmetric around the mean, showing that data near the mean are more frequent in occurrence than data far from the mean.

Z-score

A statistical measurement that describes a value's relationship to the mean of a group of values, normalized to standard deviation units.