The price elasticity of demand depends on
A)the units used to measure price and the units used to measure quantity.
B)the units used to measure price but not the units used to measure quantity.
C)the units used to measure quantity but not the units used to measure price.
D)neither the units used to measure price nor the units used to measure quantity.
E)the relative price of the good.

Question

Quizplus · Accepted Answer

The price elasticity of demand is a dimensionless measure, meaning it does not depend on the units used to measure price or quantity. It is calculated as the percentage change in quantity demanded divided by the percentage change in price, making the units cancel out.

The Price Elasticity of Demand Depends on