The more sensitive customers are to price,
A) the smaller (in absolute value) is the price elasticity of demand.
B) the more inelastic is the demand for a product.
C) the larger (in absolute value) is the price elasticity of demand.
D) the more likely price elasticity of demand will be greater than +1.

Question

Quizplus · Accepted Answer

The larger (in absolute value) is the price elasticity of demand when customers are more sensitive to price. This means that a small change in price will result in a larger change in the quantity demanded.

The More Sensitive Customers Are to Price