If a large percentage increase in the price of a good results in a small percentage reduction in the quantity demanded of the good, demand is said to be
A) of unitary elasticity.
B) relatively inelastic.
C) relatively elastic.
D) perfectly elastic.

Question

Quizplus · Accepted Answer

When a large percentage increase in price leads to a small percentage decrease in quantity demanded, the demand is relatively inelastic, meaning consumers are not very responsive to price changes.

If a Large Percentage Increase in the Price of a Good