If the price elasticity of demand for a good is 0.70, the demand for the good can be described as _________.

inelastic

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inferior

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elastic

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Giffen

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Solution

The correct option is A inelastic
solution:
If price elasticity of demand is greater than 1, demand is elastic;
if it is less than 1, demand is inelastic;
if it is equal to 1, demand has unit elasticity. Demand is unitary elastic where the proportionate change in quantity demanded and price are equal.
hence the correct option A

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