The Percentage Change in Quantity Demanded Relative to the Percentage

question 27

Multiple Choice

The percentage change in quantity demanded relative to the percentage change in price is referred to as

• A) price elasticity of demand.
• B) demand derivative of price.
• C) average demand.
• D) marginal revenue.
• E) derived demand.

---

Definitions:

Fixed Cost

Costs that remain unchanged regardless of the level of production or sales activity, such as rent, salaries, and insurance premiums.

Relevant Range

The span of activity or volume over which the assumptions about fixed and variable cost behaviors hold true for a specific business.

Fixed Cost

Costs that remain constant and do not vary with the level of business activity, including expenses like rent, salaries, and insurance.

Variable Cost

Expenses that change in proportion to the production output or sales of a company, such as raw materials and labor costs.