If the demand for a good is elastic, then
A) the quantity demanded divided by the price exceeds 1.00.
B) a change in the quantity demanded is smaller than the change in price.
C) a change in price leads to a smaller percentage change in the quantity demanded.
D) people substantially decrease the quantity of the good they buy if its price increases by a small percentage.
E) people do not change the quantity they demand when the price of the good changes.

Question

Quizplus · Accepted Answer

When demand for a good is elastic, a small percentage increase in price leads to a larger percentage decrease in the quantity demanded, meaning consumers are more sensitive to price changes.

If the Demand for a Good Is Elastic, Then