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If the absolute value of the price elasticity of demand is 0.2, this means that: 1) a 20 percent decrease in price causes a 1 percent increase in quantity demanded 2) a 0.2 percent decrease in price causes a 1 percent increase in quantity demanded 3). a 5 percent decrease in price causes a 1 percent increase in quantity demanded 4) a 0.2 percent decrease in price causes a 0.2 percent increase in quantity demanded 5). a 100 percent decrease in price causes a 200 percent increase in quantity demanded

If the absolute value of the price elasticity of demand is 0.2, this means that: 1) a 20 percent decrease in price causes a 1 percent increase in quantity demanded 2) a 0.2 percent decrease in price causes a 1 percent increase in quantity demanded 3). a 5 percent decrease in price causes a 1 percent increase in quantity demanded 4) a 0.2 percent decrease in price causes a 0.2 percent increase in quantity demanded 5). a 100 percent decrease in price causes a 200 percent increase in quantity demanded

ENGR.ECONOMIC ANALYSIS
ENGR.ECONOMIC ANALYSIS
14th Edition
ISBN:9780190931919
Author:NEWNAN
Publisher:NEWNAN
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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If the absolute value of the price elasticity of demand is 0.2, this means that:
1) a 20 percent decrease in price causes a 1 percent increase in quantity demanded
2) a 0.2 percent decrease in price causes a 1 percent increase in quantity demanded
3). a 5 percent decrease in price causes a 1 percent increase in quantity demanded
4) a 0.2 percent decrease in price causes a 0.2 percent increase in quantity demanded
5). a 100 percent decrease in price causes a 200 percent increase in quantity demanded
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