If 400 apple pies are sold at $4 per pie, but 600 apple pies are sold at $3 per pie, we know:
A)that the demand for pies is elastic over that price range.
B)that the demand for pies is inelastic over that price range.
C)that the demand for pies is unit elastic over that price range.
D)nothing about the elasticity of demand.

Question

If 400 apple pies are sold at $4 per pie, but 600 apple pies are sold at $3 per pie, we know:
A)​that the demand for pies is elastic over that price range.
B)​that the demand for pies is inelastic over that price range.
C)​that the demand for pies is unit elastic over that price range.
D)​nothing about the elasticity of demand.

Quizplus · Accepted Answer

Elasticity of demand measures how quantity demanded responds to a price change. If lowering the price from $4 to $3 increases the quantity sold from 400 to 600 pies, it indicates a responsive change in quantity demanded to a price change, suggesting demand is elastic over this price range.

If 400 Apple Pies Are Sold at $4 Per Pie