If the price elasticity of demand for a good is less than one in absolute terms,we say consumers of this good
A)are not very sensitive to price.
B)are not very sensitive to the quantity they demand.
C)are very sensitive to price.
D)are elastic.

Question

Quizplus · Accepted Answer

A price elasticity of demand less than one in absolute terms indicates that a change in price will result in a proportionally smaller change in quantity demanded. This suggests that consumers are not very sensitive to price and are likely to continue purchasing the good even if the price increases. Therefore, choice A is the correct answer.

If the Price Elasticity of Demand for a Good Is