When the absolute value of the price elasticity of demand is greater than 1, demand is:
A)elastic.
B)inelastic.
C)unit elastic.
D)perfectly inelastic.

Question

Quizplus · Accepted Answer

When the absolute value of the price elasticity of demand is greater than 1, it indicates that a small change in price will result in a relatively larger change in demand. This means that the demand is very sensitive to changes in price and is, therefore, considered elastic.

When the Absolute Value of the Price Elasticity of Demand