The following schedule represents a portion of Tim's demand for video rentals each month.
TABLE 5-2

-Refer to Table 5-2. Along this portion of Tim's demand curve for video rentals, what is the price elasticity of demand?
A) equal to zero
B) less than one
C) equal to one
D) greater than one

Question

The following schedule represents a portion of Tim's demand for video rentals each month.
TABLE 5-2
 
-Refer to Table 5-2. Along this portion of Tim's demand curve for video rentals, what is the price elasticity of demand?
A) equal to zero 
B) less than one 
C) equal to one 
D) greater than one

Quizplus · Accepted Answer

The price elasticity of demand is less than one because the percentage change in quantity demanded is less than the percentage change in price.

The Following Schedule Represents a Portion of Tim's Demand for Video