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If Gasoline Falls from $4 Per Gallon to $3 and the Quantity

Question 13

Multiple Choice

If gasoline falls from $4 per gallon to $3 and the quantity demanded rises from 3 million gallons to 4 million, what is the arc elasticity of demand?


A) 0
B) ¾
C) 4/3
D) 1

Correct Answer:

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