If the absolute value of the price elasticity of demand for a product is greater than 1, then
A) quantity demanded is not very sensitive to price changes.
B) demand is elastic.
C) demand is unit-elastic.
D) demand is inelastic.
B
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If the percentage change in price is 10 percent and the demand is elastic, then the percentage change in the quantity demanded
A) is greater than 0 percent but less than 10 percent. B) is larger than 10 percent. C) equals 0 percent. D) equals 10 percent. E) More information is needed to determine the magnitude of the change in the quantity demanded.
If pollution is bad, why do we still use pollution-causing resources such as coal and oil to generate electricity?
A) Governments lack the political will to enforce the use of pollution free resources. B) The cost of using pollution free resources to generate power in many circumstances is much higher than generating that same power through conventional pollution-causing means. C) Pollution is only a private cost. D) The transaction costs of pollution is too low.