Multiple Choice
A firm is observed using 15 units of input X when the price of X is $2. If the price of X increases to $4, the firm uses only 6 units of it. What is the price elasticity of demand for input X? (Use the simple formula for percentage change: [(new# − old#) /old#] × 100%.)
A) 1/2 = 0.5
B) 3/5 = 0.6
C) 5/3 = 1.67
D) 2
Correct Answer:
Verified
Correct Answer:
Verified
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