A 10 percent increase in the quantity of spinach demanded results from a 20 percent decline in its price. The price elasticity of demand for spinach is
A) 0.5.
B) 2.0.
C) 10.0.
D) 20.0.

Question

Quizplus · Accepted Answer

Price elasticity of demand is calculated as the percentage change in quantity demanded divided by the percentage change in price. Here, it is 10% / 20% = 0.5.

A 10 Percent Increase in the Quantity of Spinach Demanded