You have estimated the price elasticity of demand for an umbrella and found it t

Question

You have estimated the price elasticity of demand for an umbrella and found it to be inelastic. You can conclude that A. if more umbrellas are sold as the result of a price decrease, total expenditures by consumers on umbrellas will decrease. B. changes in price do not affect the number of umbrellas demanded. C. the percentage change in price (in absolute value) is less than the percentage change in quantity demanded (in absolute value). D. the percentage change in quantity demanded (in absolute value) is greater than the percentage change in price (in absolute value).

Explanation / Answer

B. changes in price do not affect the number of umbrellas demanded.

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