When the price of sugar was "low", consumers in the U.S.spent a total of $3 billion annually on sugar consumption.When the price doubled, consumer expenditures increased to $5 billion annually.This data indicates that:
A)The demand for sugar is inelastic.
B)The demand curve for sugar is upward sloping.
C)The quantity demanded of sugar increased.
D)the demand curve for sugar is upward sloping and the quantity demanded of sugar increased.

Question

Quizplus · Accepted Answer

The increase in price led to a relatively small increase in consumer spending, indicating that the demand for sugar is inelastic. If the demand were elastic, a price increase would have led to a larger decrease in quantity demanded, resulting in a decrease in total consumer spending.

When the Price of Sugar Was "Low", Consumers in the U.S.spent