If the absolute value of the price elasticity of demand for DVD movies is 0.8, then the elasticity of demand for the DVD for the movie The Hangover should be
A) less than 0.8 in absolute value.
B) greater than 0.8 in absolute value.
C) equal to 1 in absolute value.
D) equal to zero because the DVD of this movie has been out for several years.

Question

Quizplus · Accepted Answer

The elasticity of demand for a specific movie like The Hangover is likely to be greater in absolute value than the general category of DVD movies because it is more specific and consumers may have more substitutes or preferences affecting their purchasing decisions.

If the Absolute Value of the Price Elasticity of Demand