If the absolute price elasticity of demand for a product is less than 1, then
A) consumers are relatively insensitive to price changes.
B) consumers are relatively sensitive to price changes.
C) there is a positive relationship between price changes and total revenue.
D) producers are relatively insensitive to price changes.

Question

Quizplus · Accepted Answer

If the absolute price elasticity of demand for a product is less than 1, it means that a change in price does not result in a proportionate change in quantity demanded. This suggests that consumers are relatively insensitive to price changes, as the change in price is not having a significant impact on their willingness or ability to purchase the product.

If the Absolute Price Elasticity of Demand for a Product