Economists use the percentage change in quantity rather than the absolute change in quantity for elasticity calculations because:
A) percentage changes are easier to calculate than absolute changes.
B) elasticity measurements come out the same when using percentage changes regardless of the unit of measurement used for quantity.
C) absolute changes in quantity are difficult to convert to changes in price.
D) absolute changes often result in negative numbers.

Question

Quizplus · Accepted Answer

Elasticity measurements need to be independent of the units of measurement used for quantity, which is achieved by using the percentage changes in quantity. Absolute changes in quantity cannot be used as they depend on the units of measurement used.

Economists Use the Percentage Change in Quantity Rather Than the Absolute