Suppose the price elasticity of demand for some good is 1.4.A 10% increase in the price of the good results in
A)a 1.4% decrease in the quantity demanded.
B)a 1.4% increase in the quantity demanded.
C)a 14% increase in the quantity demanded.
D)a 14% decrease in the quantity demanded.
E)There is not enough information to answer this question.

Question

Quizplus · Accepted Answer

A price elasticity of 1.4 means that a 1% increase in price will result in a 1.4% decrease in quantity demanded. Therefore, a 10% increase in price would result in a 14% decrease in quantity demanded.

Suppose the Price Elasticity of Demand for Some Good Is