Question 14
MediumOriginal questionRead the two statements and choose the correct option.
I. If eₚ = 1.5, a 2% price rise lowers quantity demanded by 3%.
II. If eₚ = 0.5, a 2% price rise lowers quantity demanded by 4%.
Show the answer and explanation
CorrectNot quiteAnswer A
Correct answer: A
Explanation
1.5 × 2% = 3%: I is true.
0.5 × 2% = 1%, not 4%: II is false.
- Concept
- Applying elasticity
- Typical timeTypical
- 70 s
- Your timeYours
- —
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