The price elasticity of demand is
A) always positive.
B) usually negative, but could be zero.
C) sometimes zero and sometimes positive.
D) always one.

Question

Quizplus · Accepted Answer

The price elasticity of demand measures the responsiveness of quantity demanded to changes in price. Typically, a lower price (increase in quantity demanded) corresponds to a higher quantity of product sold, and a higher price (decrease in quantity demanded) corresponds to a lower quantity of product sold. Thus, there is usually an inverse or negative relationship between price and quantity demanded, making B the best choice. However, in certain cases, such as with necessities like medical treatment, the price elasticity of demand may be zero or relatively low.

The Price Elasticity of Demand Is