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A business decreases the price of their product by 10%, as a result, consumer demand for the product has also increased by 10%. Which term does the scenario best describe?

Ademand elasticity

Binelastic demand

Celastic demand

Dunit elastic demand

Verified Answer :

metchelle

The answer to the question is letter A. The term described in the above example or scenario is demand elasticity. The term is a measure of the relavance between a change in the quantity of a particular good and a change of the price of the good.

The answer
is A.

The demand
elasticity is often described as the reaction of the supply and demand in the
price change. There are many factors that affect the elasticity of a product.
If products are essential, even if a price hike would occur, people would still
be buying it. If the prices go down, it would also increase the demand.

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