Asked by Brandon Pimentel on Jul 12, 2024
Verified
If the demand for bacon is relatively elastic, a 10 percent decline in the price of bacon will
A) decrease the amount demanded by more than 10 percent.
B) increase the amount demanded by more than 10 percent.
C) decrease the amount demanded by less than 10 percent.
D) increase the amount demanded by less than 10 percent.
Relatively Elastic
Describes a situation where a small change in price leads to a larger change in quantity demanded or supplied.
Price Decline
A decrease in the cost of goods or services, often resulting from lower demand, increased supply, or external market factors.
- Outline the variances between elastic, inelastic, and unit-elastic demand.
Verified Answer
YS
Yogesh SachdevaJul 18, 2024
Final Answer :
B
Explanation :
When demand is relatively elastic, a decrease in price leads to a proportionally larger increase in the quantity demanded. Thus, a 10 percent decline in the price of bacon will increase the amount demanded by more than 10 percent.
Learning Objectives
- Outline the variances between elastic, inelastic, and unit-elastic demand.