Author Question: If an increase in the price of a product from 1 to 2 per unit leads to a decrease in the quantity ... (Read 59 times)

Collmarie · **on:** Jun 30, 2018

If an increase in the price of a product from 1 to 2 per unit leads to a decrease in the quantity demanded from 100 to 80 units, then according to the averaging equation, the value of price elasticity of demand in absolute terms is:
a. 0.33.
b. 2.33.
c. 0.25.
d. 3.
e. 0.66.

Question 2

If an increase in the price of a product from 1 to 2 per unit leads to a decrease in the quantity demanded from 100 to 80 units, then demand is:
a. elastic.
b. inelastic.
c. of unitary elasticity.
d. 0.
e. inferior.