Please help. I don't understand why these answers are what they are! =(?

Question

_____ 7. For every one percent increase in the price of an automobile, approximately 2.4 percent fewer

individuals bought an automobile. This indicates that if automobile prices were to increase,

the proportionate decline in automobile sales would be _____ the proportionate increase in

automobile prices.

A. less than <

B. the same as

C. greater than

D. not related to

_____ 8. For every one percent increase in the price of a gallon of gasoline, approximately 0.8 percent

fewer gallons of gasoline are sold. This indicates that if the price of a gallon of gasoline were to

increase, the proportionate decline in gasoline purchases would be _____ the proportionate

increase in gasoline prices.

A. less than

B. the same as

C. greater than <

D. not related to

I don't understand either of these! Why!!?!

Answer 1

For question no. 7

Let us understand the concept first--&gt;

Suppose the automobile costs 10,000

Lets say if cost is 10,000----  1000 people buy the automobile,

,

&quot;For every one percent increase in the price of an automobile, approximately 2.4 percent fewer

individuals bought an automobile. &quot;

This means if cost increase by 1% = 10,000*1/100= $100 (increase in price)

2.4% few people= 1000*2.4/100= 24(decrease in number of buyers)

In One line- if the cost of a car was $10,000 and buyers were

1000 people; IF cost increased by 1% i.e. 1% of $10,000= $100= NEW COST= $1100

And number of buyers decrease by 2.4%= 2.4% of1000= 24