For many goods, the price elasticity of demand increases over time after a price hike because
A) consumer incomes tend to increase over time.
B) inflation increases all prices and incomes over time.
C) the ability to find good substitutes for the product whose price rose increases over time.
D) All of the above answers are correct.
C
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In a market, social surplus is maximized if consumers' willingness to pay for the good equals the ________
A) marginal private cost of producing the good B) marginal external cost of producing the good C) marginal social cost of producing the good D) opportunity cost of producing the good
If society decides it wants more of one good and ________, then it has to give up some of another good and incur some opportunity costs
A) new resources are discovered B) all resources are fully utilized C) technology advances D) resources are underutilized
A soil bank program pays ___________ in order to _________
a. farmers' mortgages; eliminate bankruptcy b. farmers' mortgages; reduce the parity price ratio c. farmers to not grow; reduce excess demand d. farmers to grow; rejuvenate the land e. farmers to not grow; reduce supply
The market demand for an item is
a. the sum of individual demands. b. steeper for any given price change than the individual demand curves. c. independent of the number of individuals in the market. d. determined by dividing the quantity demanded by each individual by the number of individuals in the market.