If the price elasticity of demand is 2,then a 1 percent fall in price
A)doubles the quantity demanded.
B)decreases the quantity demanded by half.
C)increases the quantity demanded by 2 percent.
D)decreases the quantity demanded by 2 percent.
E)increases the quantity demanded by 0.5 percent.

Question

Quizplus · Accepted Answer

The price elasticity of demand measures how much the quantity demanded of a good responds to a change in the price of that good. A price elasticity of 2 means that a 1 percent decrease in price leads to a 2 percent increase in the quantity demanded.

If the Price Elasticity of Demand Is 2,then a 1