If the absolute value of the own-price elasticity of steak is 0.4, a decrease in price will lead to: A reduction in total revenue.
Own-price elasticity
A measure of a good's responsiveness to changes in its own price is called own price elasticity.
Unitary elastic, where |OED | = 1 if the absolute value is 1. In other words, changes in price have an equivalent proportion impact on quantity demanded. A 10% price rise will result in a 10% drop in demand.
When a price adjustment has no impact on the amount of demand, this is known as demand being perfectly inelastic. In other words, regardless of the price level, the quantity demanded does not change. The elasticity of demand at all prices is therefore zero, as can be seen from the statement.
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