A value of the absolute price elasticity of demand equal to 0.5 indicates that
A) a 5 percent increase in price leads to a 10 percent decrease in quantity demanded.
B) a 10 percent increase in price leads to a 5 percent decrease in quantity demanded.
C) a 0.5 percent increase in price leads to a 1 percent decrease in quantity demanded.
D) a 1 percent increase in price leads to a 5 percent decrease in quantity demanded.
Answer: B
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A) national saving, investment B) national saving, consumption C) steady-state investment, capital D) steady-state investment, depreciation E) steady-state investment, national saving
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What will be an ideal response?
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