Absolute price elasticities are calculated for four goods, and the values are: 0.009; 1.0; 3.5; and 4. Which indicates the most price-responsive situation?
A) 0.009
B) 1.0
C) 3.5
D) 4.0

Question

Quizplus · Accepted Answer

The higher the absolute value of the price elasticity, the more responsive the quantity demanded is to a change in price. A value of 4 indicates the highest responsiveness among the given options.

Absolute Price Elasticities Are Calculated for Four Goods, and the Values