If the price elasticity of demand for a good is 0.8, then a
A) 1 percent rise in the price leads to a 0.8 percent decrease in the quantity demanded.
B) one dollar rise in the price leads to a 0.8 percent decrease in the quantity demanded.
C) 1 percent rise in the price leads to an 80 percent decrease in the quantity demanded.
D) 1 percent rise in the price leads to an 8 percent decrease in the quantity demanded.

Question

Quizplus · Accepted Answer

Price elasticity of demand of 0.8 means that a 1% increase in price results in a 0.8% decrease in quantity demanded.

If the Price Elasticity of Demand for a Good Is