If a 10 percent price increase generates a 20 percent decrease in quantity demanded,then demand is
A) elastic.
B) perfectly inelastic.
C) perfectly elastic.
D) inelastic.
E) unit elastic.

Question

Quizplus · Accepted Answer

The given scenario indicates that the percentage change in quantity demanded is greater than the percentage change in price. This implies that the demand is responsive to a change in price, indicating elastic demand. Therefore, option A is the best choice.

If a 10 Percent Price Increase Generates a 20 Percent