Which of the following illustrates elastic demand?
A) a price elasticity of 1.0.
B) A 5 percent increase in price causes a 10 percent decrease in quantity demanded.
C) A 5 percent increase in price causes a 2.5 percent decrease in quantity demanded.
D) A 10 percent increase in price causes a 10 percent reduction in quantity demanded.
E) a price elasticity of 0.8.
Correct Answer:
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