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Sagot :
In the case when there is a 10% increase in the price of the good that results in the decrease in the quantity demanded to 25% so the demand should be inelastic.
Given that,
- The price of the good is increased by 10%.
- The quantity demanded is reduced to a 25%
Now the elasticity should be
= -25% ÷ 10%
= -2.5%
Therefore we can conclude that when there is a 10% increase in the price of the good that results in the decrease in the quantity demanded to 25% so the demand should be inelastic.
Learn more about the inelastic here: brainly.com/question/13572905
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