If a 1 percent decrease in price results in less than a 1 percent increase in the quantity demanded, demand is
A) cross-price elastic.
B) price inelastic.
C) price elastic.
D) status quo elasticity.
E) derived demand inelastic.

Question

Quizplus · Accepted Answer

This indicates that the demand is price inelastic, as a 1 percent reduction in price leads to less than a 1 percent increase in the quantity demanded.

If a 1 Percent Decrease in Price Results in Less