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Bailey's Barber Shop Knows That a 5 Percent Increase in the Price

Question 73

Multiple Choice

Bailey's Barber Shop knows that a 5 percent increase in the price of their haircuts results in a 15 percent decrease in the number of haircuts purchased. What is the elasticity of demand facing Bailey's Barber Shop?


A) 0.05
B) 0.10
C) 0.15
D) 3.0

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