There are two methods of calculating elasticities. One calculates the ratio of the percentage changes in quantity and price, and the other calculates the average percentage changes in quantity and price. We use the second method because it
a. involves an additional calculation
b. is not sensitive to direction of movement
c. is sensitive to direction of movement
d. is never wrong
e. always has the same sign
B
You might also like to view...
Under present U.S. federal law, which one of the following is a government-inhibited good?
A) housing B) medical care C) marijuana D) education
Table 3-2 Combination Cotton Corn A 12 16 B 17 15 C 21 13 D 23 9 E 24 5 ? The concept of opportunity cost can be represented graphically by the
A. area inside the production possibilities frontier. B. slope of the production possibilities frontier. C. vertical distance from the horizontal axis to the production possibilities frontier. D. horizontal distance from the vertical axis to the production possibilities frontier. E. sum of the horizontal and vertical distances to the production possibilities frontier.