The more sensitive people are to a change in price, the
A) greater a change in price must be to induce a certain change in quantity demanded.
B) greater is the price elasticity of demand.
C) smaller the price elasticity of demand.
D) closer the price elasticity of demand is to one.
Answer: B) greater is the price elasticity of demand.
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Any item can successfully serve as money
a. True b. False Indicate whether the statement is true or false
Suppose purchasing power parity exists in the car stereo market in the United States and Australia. If a car stereo costs $230 in the United States and the exchange rate is $1 = $AUD1.67, the same car stereo may be purchased in Australia for approximately:
a. $AUD 138. b. $AUD 230. c. $AUD 2,300. d. $AUD 384. e. $AUD 108.
When the demand for loanable funds rises, the amount of money borrowed will ___________.
A. rise B. decline C. be unchanged
Which of the following is false?
A. The monopolist and perfect competitor both produce where MC equals MR. B. A monopoly is a firm that produces all the output in an industry. C. If a monopolist is losing money, it is in the long run. D. Price is read off the demand curve for the monopolist.