To determine the price elasticity of demand, we
A) compare the change in the quantity to the change in price.
B) compare the percentage change in the quantity demanded to the percentage change in price.
C) need information on consumers' incomes.
D) divide the quantity by the price.
E) need to know how much is available.

Question

Quizplus · Accepted Answer

Price elasticity of demand is determined by comparing the percentage change in quantity demanded to the percentage change in price. This helps us understand how responsive consumers are to price changes for a particular product or service. It is not related to consumers' incomes, the quantity or availability of the product, or simply comparing the change in quantity to the change in price.

To Determine the Price Elasticity of Demand, We