When the price increases by 30% and the quantity demanded drops by 30%,the price elasticity of demand is:
A)perfectly inelastic.
B)inelastic.
C)unitary elastic.
D)elastic.
E)perfectly elastic.

Question

Quizplus · Accepted Answer

The price elasticity of demand is calculated as the percentage change in quantity demanded divided by the percentage change in price. Here, both are 30%, so the elasticity is 1, indicating unitary elasticity.

When the Price Increases by 30% and the Quantity Demanded