The price elasticity of demand for new cars is 1.2. Hence, a 10 percent price increase will
A) decrease the quantity of new cars demanded by 1.2 percent.
B) increase consumer expenditure on new cars by 1.2 percent.
C) decrease the quantity of new cars demanded by 12 percent.
D) increase consumer expenditure on new cars by 12 percent.
C
Economics
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The situation where "the few who yell the loudest gets heard" is referred to as the:
A. Special-interest effect B. Principal-agent problem C. Moral hazard problem D. Adverse selection effect
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