It is Valentine's Day and Fred is desperately searching all over town for a dozen roses to give to Diane. "I'll pay anything for a dozen roses," he says. Whether he really means it or not, the statement implies that his price elasticity of demand for roses is
a. infinite
b. negative
c. one
d. greater than one
e. zero
E
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Classical macroeconomic theorists believed that economic downturns:
A. would not end quickly without government intervention. B. could be completely eliminated through increased government spending. C. would not lead wages to fall. D. would generally reverse themselves quickly without policy intervention.
An increase in interest rates will generally lead to a(n) ____ in present investment and a(n) ____ in future income and production.
A. decrease, decrease B. decrease, increase C. increase, decrease D. increase, increase
The struggle among various producers for the consumer's business called ____________ .
a. socialism b. competition c. incentive d. self-regulation
The incentive structure is a
A. system of rewards and punishments that individuals consider when making decisions. B. system determined by the federal government that gives certain states more federal funds. C. system of checks and balances in the government. D. system of infrastructure in the United States that improves commerce.