If the Price Elasticity of Demand for a Good Is

question 257

Multiple Choice

If the price elasticity of demand for a good is 0.25, then a 20 percent decrease in price results in a

• A)​0.0625 percent increase in the quantity demanded.
• B)​4 percent increase in the quantity demanded.
• C)​5 percent increase in the quantity demanded.
• D)​80 percent increase in the quantity demanded.

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Definitions:

Research Method

A systematic approach to conducting research that involves collecting data, analyzing information, and presenting findings.

Infer

To deduce or conclude information from evidence and reasoning rather than from explicit statements.

Extraneous Variables

Extraneous variables are those that are not the focus of a study but may influence its outcome, potentially confounding the results if not controlled.

Random Assignment

A procedure in experimental design that ensures every participant has an equal chance of being assigned to any group, enhancing the validity of results.