When the percentage change in quantity demanded is larger than the percentage change in price, demand is said to be:
A) price inelastic.
B) unit price elastic.
C) price elastic.
D) perfectly inelastic.

Question

Quizplus · Accepted Answer

When the percentage change in quantity demanded is larger than the percentage change in price, it means that buyers are very responsive to changes in price. In other words, a small increase in price leads to a significant decrease in demand. This is known as price elasticity of demand and shows that demand is price elastic.

When the Percentage Change in Quantity Demanded Is Larger Than