If the Price of a Product Increases by 5 Percent

question 217

Multiple Choice

If the price of a product increases by 5 percent and the quantity demanded decreases by 5 percent,then the elasticity of demand is

• A) 0.
• B) 1.
• C) indeterminate.
• D) 5.
• E) 25.

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Definitions:

Terror Management Theory

A psychological perspective positing that fear of mortality drives humans to develop cultural worldviews for meaning, stability, and self-esteem.

Mortality

The state of being subject to death; the death rate within a population.

Prejudice

a preconceived opinion or judgment towards people or a situation, which is not based on actual experience or reasoning.

Realistic Group Conflict

The theory that group conflicts arise from actual competition for resources or conflicting goals between groups.