If the absolute value of the own price elasticity of demand is greater than 1,then demand is said to be:
A) elastic.
B) inelastic.
C) unitary elastic.
D) neither elastic, inelastic, nor unitary elastic.

Question

Quizplus · Accepted Answer

When the absolute value of own price elasticity of demand is greater than 1, it indicates that a small change in price results in a relatively larger change in the quantity demanded. In other words, consumers are highly sensitive to price changes, and a small increase or decrease in price can lead to a significant increase or decrease in the quantity demanded. This is known as elastic demand.

If the Absolute Value of the Own Price Elasticity of Demand