The above table shows a sample of prices and the quantity sold by a monopolist.
-Refer to the table above. At a price of $96, which of the following statements is true regarding the price elasticity of demand?

Question

Quizplus · Accepted Answer

At a price of $96, the quantity sold is 4. The price elasticity of demand measures the responsiveness of quantity demanded to a change in price. If the demand is inelastic (meaning the absolute value of the price elasticity of demand is less than one), a change in price will result in a proportionally smaller change in quantity demanded. In this case, the quantity sold only changes by 1 when the price increases from $95 to $96, indicating that the demand is relatively inelastic. Therefore, the correct answer is A) The price elasticity of demand is less than one.

The Above Table Shows a Sample of Prices and the Quantity