Multiple Choice
Suppose a fast-food chain determines that the price elasticity of demand for its hamburgers is 1.7,and the price of the hamburger is currently $4.00.What will be the effect on quantity demanded and total expenditure on this chain's hamburgers if the price is increased to $6.00?
A) Quantity demanded will fall by 68% and total expenditure will decrease.
B) Quantity demanded will fall by 11.76% and total expenditure will decrease.
C) Quantity demanded will fall by 17% and total expenditure will increase.
D) Quantity demanded will fall by 1.7% and total expenditure will increase.
E) Quantity demanded will fall by 34% and total expenditure will decrease.
Correct Answer:
Verified
Correct Answer:
Verified
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