The price elasticity of demand measures
A) the consumers' sensitivity to a price change.
B) the producers' sensitivity to a price change.
C) how much the market price changes in response to a change in demand.
D) how much the demand changes in response to a change in income.

Question

Quizplus · Accepted Answer

The price elasticity of demand measures the responsiveness of consumers to a change in price. It indicates whether a small change in price will cause a significant change in the quantity of the good or service demanded by consumers. Therefore, option A is the correct answer as it correctly describes the price elasticity of demand.

The Price Elasticity of Demand Measures