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A Local Krispy Kreme Doughnut Shop Reduced Its Prices by 10

Question 130

Multiple Choice

A local Krispy Kreme doughnut shop reduced its prices by 10 percent, and as a result, the quantity of doughnuts sold increased by 25 percent. Over this range, the absolute value of the price elasticity of demand was


A) 0.4.
B) 1.
C) 2.
D) 2.5

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