Relative percentage changes are used in measuring price elasticity of demand, so that
A) it does not matter whether price increases or decreases when calculating the elasticity.
B) it does not matter what units are used to measure prices or quantities.
C) we always obtain a positive number.
D) larger numbers indicate greater responsiveness.

Question

Quizplus · Accepted Answer

Relative percentage changes ensure that the elasticity measure is unit-free, meaning it is not affected by the units in which price or quantity are measured.

Relative Percentage Changes Are Used in Measuring Price Elasticity of Demand