Which of the following statements is true about the price elasticity of demand?
A)It is higher in the short run than in the long run because people's habits change slowly.
B)It is higher in the long run than the short run because people have more time to find substitute products.
C)It is the same in the short run and the long run.
D)It is higher in the short run because markets adjust slowly to changes.

Question

Quizplus · Accepted Answer

In the long run, consumers have more time to find substitute products and adjust their consumption habits, making them more responsive to changes in price. In the short run, people's habits may not change as quickly, making price elasticity of demand lower.

Which of the Following Statements Is True About the Price