The calculated price elasticity of demand:
A)is always a negative number,although many times is reported as an absolute value.
B)is sometimes a negative number,depending on the magnitude of response.
C)is always a positive number,because price and quantity are directly related in terms of demand.
D)can be positive or negative,but is always reported as an absolute value.

Question

Quizplus · Accepted Answer

The price elasticity of demand measures the responsiveness of quantity demanded with respect to changes in price. Since price and quantity demanded have an inverse relationship, the elasticity will always be negative. However, it is common to report the absolute value of the elasticity to make it easier to interpret.

The Calculated Price Elasticity of Demand