Elasticity of demand measures:

A Total revenue

B The responsiveness of quantity demanded to changes in price

C Profit margin

D Supply changes

✓ Correct Answer: Option B

Price elasticity of demand = % change in quantity demanded / % change in price. Elastic (>1): quantity sensitive to price. Inelastic (<1): quantity less responsive.

💡 Why is B) the correct answer?

The correct answer to the question "Elasticity of demand measures:" is Option B: The responsiveness of quantity demanded to changes in price.

The other options — A) Total revenue, C) Profit margin, D) Supply changes — are incorrect for this Pre-MBA Exam Prep question. As explained above: Price elasticity of demand = % change in quantity demanded / % change in price. Elastic (>1): quantity sensitive to price. Inelastic (

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Elasticity of demand measures:

✓ Correct Answer: Option B

📚 About This Pre-MBA Exam Prep Practice Question

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