When a demand curve is price inelastic
A) a reduction in price increases the amount spent on the good.
B) the quantity demanded will increase even if price remains constant.
C) a 1 percent increase in price will result in a less than 1 percent decrease in the quantity demanded.
D) the change in quantity will always be greater than the change in price.
E) demand must be falling.

Question

Quizplus · Accepted Answer

When demand is price inelastic, the percentage change in quantity demanded is less than the percentage change in price. So, a 1 percent increase in price will result in a less than 1 percent decrease in the quantity demanded.

When a Demand Curve Is Price Inelastic