Multiple Choice
Suppose you calculate the price elasticity of demand for a certain good and you report that the elasticity is 0.8.The fact that the elasticity is a positive number means that
A) when the price of the good increases, the quantity demanded increases in response.
B) demand for the good is elastic.
C) you have dropped the minus sign and reported the absolute value of the elasticity.
D) the good has close substitutes and/or the good is a luxury.
Correct Answer:
Verified
Correct Answer:
Verified
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