Elasticity is:
A) the change in a dependent variable divided by the change in an independent variable.
B) the ratio of the percentage change in a dependent variable to the percentage change in an independent variable.
C) the price of a good divided by its quantity.
D) the quantity of a good divided by its price.

Question

Quizplus · Accepted Answer

Elasticity is a measure of responsiveness, and the ratio of the percentage change in the dependent variable to the percentage change in the independent variable provides a standardized measure of responsiveness. Choice A is incorrect because it does not standardize for differences in units. Choice C is incorrect because it is not a measure of responsiveness. Choice D is the inverse of price elasticity of demand and is also not a measure of responsiveness.

Elasticity Is