Suppose egg producers succeed in permanently raising the price of their product by 15 percent, and as a result the quantity demanded falls by 15 percent in the short run. In the long run we can expect the quantity demanded to fall by
A) 15 percent.
B) 0 percent.
C) between 0 and 15 percent.
D) more than 15 percent.
E) 100 percent.

Question

Quizplus · Accepted Answer

In the long run, consumers have more time to adjust to the price change and find substitutes or change their habits. Therefore, we can expect the quantity demanded to be more elastic, resulting in a greater reduction than the initial 15 percent.

Suppose Egg Producers Succeed in Permanently Raising the Price of Their