Answer:
The demand for fast-food french fries is inelastic.
Explanation:
1% increase in the price of french fries at fast-food restaurants, will cause the quantity demanded of french fries will decrease by 0.44%.
The price elasticity of demand is calculated as a ratio of the percentage change in quantity demanded and percentage change in price.
Price elasticity of demand
= [tex]\frac{ \Delta Q}{ \Delta P}[/tex]
= [tex]\frac{0.44}{1}[/tex]
= 0.44
The price of elasticity of demand is less than 1. This implies that the price elasticity of demand is inelastic. Inelastic demand means that a change in the price level will cause a less than proportionate change in the quantity demanded.
