Exhibit 5-1 Demand Curve

Multiple Choice

Exhibit 5-1 Demand curve

If demand price elasticity is 2, consumers would:

A) buy twice as much of the product in response to a 10 percent decrease in prie.
B) require a 2 percent drop in price to increase their purchases by 1 percent.
C) buy 2 percent more of the product in response to a 1 percent decrease in price.
D) buy twice as much of the product in response to a 1 percent decrease in price.