If We Ignore the Negative or Positive Sign,the Midpoint Method

question 32

Multiple Choice

If we ignore the negative or positive sign,the midpoint method of calculating a percentage change in price between two points on a demand curve results in

• A) a smaller percentage change if the price rises than if it falls.
• B) the same percentage, regardless of whether the price increases or decreases.
• C) the price elasticity of demand.
• D) the price elasticity of supply.
• E) a higher percentage change if the price rises than if it falls.

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Definitions:

Utility Function

A form of mathematical model that orders a person's preferences across a range of products and services.

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Formal instruction in playing the piano, typically involving one-on-one sessions between a student and a teacher.

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The fee, shown as a fraction of the total amount lent, that a lender imposes on a borrower for the utilization of resources.