"Price elasticity measures how many more units of a good that consumers will buy given a decrease in price." Do you agree or disagree? Explain
What will be an ideal response?
Disagree. Price elasticity measures the percentage change in quantity demanded in response to a percentage change in price. As such, the statement is not valid as the elasticity measure is unit free.
You might also like to view...
If buyers of a monopolistically competitive product feel the products of different sellers are strongly differentiated, then the demand for each seller's product is
A) relatively elastic. B) relatively inelastic. C) perfectly inelastic. D) perfectly elastic.
When cross-sections of Americans are asked what the main problem they are dealing with is, the majority will say they don't have:
a. Nearly enough time b. A big enough house c. Enough money d. Meaningful relationships
In response to the financial crisis which followed the housing bubble collapse, policy-makers feared stimulating demand would cause:
A. inflation. B. deflation. C. stagflation. D. hyperinflation.
If real GDP per capita is increasing, real output is:
a. growing less rapidly than the population. b. growing more rapidly than the population. c. growing at the same rate as the population. d. growing more rapidly than are prices.