Which one of the following statements is correct? Demand is described by economists as elastic where:
A)Customers place a high value on the product
B)Demand is highly sensitive to changes in price
C)Prices can rise substantially without affecting demand
D)Demand for the product is relatively insensitive to price

Question

Quizplus · Accepted Answer

Elastic demand means that a small change in price leads to a relatively large change in the quantity demanded. This indicates that demand is highly sensitive to changes in price.

Which One of the Following Statements Is Correct? Demand Is