Observations of consumer behavior suggest that when the price of gasoline rose above $3.50 per gallon, consumer demand for gas became considerably more price elastic.
64) A demand elasticity coefficient is a measure of the sensitivity of quantity demanded to a change in one of the determinants of demand.
65) In order to ensure consistency across goods and services, elasticities should always be calculated based on absolute changes in quantity demanded.
66) The price elasticity of demand is measured as the percentage change in quantity demanded divided by the percentage change in price.
67) The price elasticity of demand is measured as the percentage change in price divided by the percentage change in quantity demanded.
68) Knowledge about the price elasticity of demand is especially useful to managers because it allows them to predict how a change in price would affect a firm's total revenues.
69) Knowledge about the price elasticity of demand is especially useful to managers because it allows them to predict how a change in price would affect a firm's total profit.
70) When calculating the price elasticity of demand, it is assumed that all of the other determinants of demand are to be held constant.
71) If a 10 percent increase in the price of a luxury hotel room causes the quantity demanded to decrease by 41.5 percent., we can conclude that the price elasticity of demand for luxury hotel rooms is approximately -0.24.
72) Assuming the demand curve in question is downward sloping, the calculated price elasticity of demand will always be negative.
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