If the price of Citgo gasoline increases by 10% and the quantity demanded decreases by 20%, then the demand for gasoline is
A) inelastic.
B) elastic.
C) unitary elastic.
D) a perfect substitute.

Question

Quizplus · Accepted Answer

The demand is considered elastic when the percentage change in quantity demanded is greater than the percentage change in price, which is the case here (20% decrease in quantity demanded with a 10% increase in price).

If the Price of Citgo Gasoline Increases by 10% and the Quantity