In the above figure, through which range would the demand for this good be most inelastic?
A) A-B
B) B-E
C) E-F
D) G-H
D
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Income has risen in the simple Keynesian model. This could be the result of:,
a. an equal increase in government spending and taxes. b. an increase in unplanned investment. c. an increase in taxes d. a decrease in autonomous consumption. e. none of the above
Explain the policy implications of the classical economists' beliefs
To close a recessionary gap, Keynesian theory calls for
A. expansionary fiscal policy. B. contractionary fiscal policy. C. international trade. D. none of these.
Draw a demand curve and label it D1. On the graph, illustrate an increase in demand and a decrease in demand, and label the curves D2 and D3, respectively. Starting on demand curve D1, explain the shift that would result from each of the following events:
a. an increase in income and the good is a normal good b. an increase in income and the good is an inferior good c. a decrease in the price of a substitute good d. a decrease in the price of a complementary good e. an increase in the taste for the good f. a decrease in population g. an increase in the expected future price of the good