What does the price elasticity of demand measure?

Show Answers

The proportion of price change relative to the change in quantity demanded.The ratio of the percentage change in quantity demanded to the percentage change in price.The proportion of quantity demanded change compared to the price change.The ratio of the percentage change in price to the percentage change in quantity demanded.The absolute difference between price and quantity demanded.

Explanation

Price elasticity of demand is defined as the ratio between the percentage change in quantity demanded and the percentage change in price, indicating how sensitive the quantity demanded is to price variations.