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Assume That Demand Decreases by 3 Percent, the Absolute Value

Question 58

Multiple Choice

Assume that demand decreases by 3 percent, the absolute value of price elasticity of demand is 1.0, and price elasticity of supply is 1.0. What is the percentage price change in this case?


A) -1.5
B) -0.5
C) 0.5
D) 1.5

Correct Answer:

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