The negative value of the price elasticity of demand for a good can be attributed to ________.
A) the Law of Demand
B) the Law of Supply
C) the Law of Increasing Marginal Utility
D) the Law of Diminishing Marginal Rate of Substitution

Question

Quizplus · Accepted Answer

The negative value of price elasticity of demand is attributed to the Law of Demand, which states that as the price of a good increases, the quantity demanded of that good decreases. The negative sign in the price elasticity formula indicates an inverse relationship between price and quantity demanded.

The Negative Value of the Price Elasticity of Demand for a Good