The long-run price elasticity of demand for electricity is ________ the short-run price elasticity of demand for electricity.
A) greater than
B) less than
C) equal to
D) not comparable to
E) unrelated to

Question

Quizplus · Accepted Answer

In the long-run, consumers have more time to adjust their behavior and find alternatives to using electricity, making the demand more elastic. In the short-run, consumers have less flexibility to switch to alternatives, making the demand less elastic. Therefore, the long-run price elasticity of demand for electricity is greater than the short-run price elasticity of demand for electricity.

The Long-Run Price Elasticity of Demand for Electricity Is ________