If the elasticity of demand for the latest American Idol CD is 1.4,this means:
A)few substitutes exist.
B)a 1% increase in the price leads to a 14% reduction in quantity demanded.
C)a 10% decrease in the price leads to a 140% increase in quantity demanded.
D)a 5% increase in the price leads to a 7% decrease in quantity demanded.

Question

Quizplus · Accepted Answer

Demand for necessities is less price elastic than demand for non-necessities.

If the Elasticity of Demand for the Latest American Idol