Asked by Brit'Ney McCoy on Jul 09, 2024
Verified
When the price of CD players increases 5%,quantity demanded decreases 5%.The price elasticity for CD players is
A) inelastic.
B) unit elastic.
C) elastiC.
D) perfectly inelastic.
Price Elasticity
A measure of the responsiveness of quantity demanded or supplied of a good to a change in its price.
Quantity Demanded
The quantity of a good that consumers are willing and able to purchase at a given price over a specified period of time.
CD Players
Devices used for playing audio CDs that were a popular technology for music playback before being gradually replaced by digital music players.
- Differentiate the characteristics of elastic, inelastic, and unit-elastic demand.
Verified Answer
EV
estephanie VillarrealJul 09, 2024
Final Answer :
B
Explanation :
The price elasticity of demand is calculated as the percentage change in quantity demanded divided by the percentage change in price. Here, both changes are 5%, resulting in an elasticity of 1, which is defined as unit elastic.
Learning Objectives
- Differentiate the characteristics of elastic, inelastic, and unit-elastic demand.