Author Question: If a 5 percent decrease in the price of a good produces a 5 percent increase in the quantity ... (Read 44 times)

tatyanajohnson · **on:** Jun 30, 2018

If a 5 percent decrease in the price of a good produces a 5 percent increase in the quantity demanded, the price elasticity of demand is:
a. perfectly elastic.
b. perfectly inelastic.
c. elastic.
d. inelastic.
e. unitary elastic.

Question 2

Suppose the quantity demanded is 1,000 million bushels of peaches per year when the price is 3 per bushel and 1,500 million bushels when the price is 1 per bushel. The price elasticity of demand in this range of the demand curve is:
a. elastic. b. inelastic.
c. unitary elastic. d. infinitely elastic.