Suppose that the value of the short-run absolute elasticity of demand for a good is 0.38. Then, we know the long-run absolute price elasticity of demand will be
A) 0.
B) greater than 0.38.
C) elastic.
D) less than 0.38.

Question

Quizplus · Accepted Answer

In the long run, consumers have more time to adjust their behavior in response to price changes, so the long-run elasticity of demand is typically greater than the short-run elasticity.

Suppose That the Value of the Short-Run Absolute Elasticity of Demand