The table above gives the demand schedule for peas. Which of the following statements CORRECTLY describes the price elasticity of demand?
A) The price elasticity of demand is larger at point A than at point B.
B) The price elasticity of demand is larger at point D than at point A.
C) The price elasticity of demand is constant because the slope is constant.
D) The price elasticity of demand increases moving from point A to point B to point C to point D to point E.
Question 2
One economist says that raising taxes on gas would be in the social interest. What does this economist mean?
A) Higher taxes on gas would benefit society as a whole.
B) Raising taxes on gas would benefit most of the people.
C) Higher taxes on gas would benefit everyone.
D) Both answers A and C are correct.
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