If 100 units of product L are sold at a unit price of $10 and only 25 units are sold at a unit price of $20, one can conclude that demand for L is
A) perfectly inelastic.
B) inelastic.
C) elastic.
D) infinitely elastic.
E) unit elastic.

Question

Quizplus · Accepted Answer

Demand for a product is said to be elastic when a small change in price leads to a proportionally larger change in quantity demanded. In this scenario, since the demand for the product decreases significantly when the price increases only slightly, it can be inferred that the demand for L is elastic.

If 100 Units of Product L Are Sold at a Unit