The absolute price elasticity of demand would be the lowest for
A. automobiles.
B. movie tickets.
C. sugar.
D. Mr. Donut coffee.
Answer: C
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Households receive transfers from ________, and firms receive transfers from ________
A) firms; households B) government; government and households C) government; no one D) firms and government; government E) government; government
The larger the marginal rate of substitution, the larger is the amount of one good that the consumer is willing to give up in exchange for another good and still remain at the same level of satisfaction
Indicate whether the statement is true or false
Which of the following distinctions does not help to explain the difference between relevant and irrelevant cost?
A) historical vs. replacement cost B) sunk vs. incremental cost C) variable vs. fixed cost D) out-of-pocket vs. opportunity cost E) All help to explain the difference.
Typically, the lower the level of income per person in a country, the lower the level of spending per person on health care. This relationship between income and spending indicates that health care is a
A) normal good. B) inferior good. C) luxury. D) necessity.