Other things constant, the price elasticity of demand for a product will tend to be smaller (more inelastic) if
a. people spend a large share of their income on the product.
b. people spend an insignificant share of their income on the product.
c. the population in the market area is large.
d. there are many good substitutes for the product.
B
You might also like to view...
A reserve requirement set by the Federal Reserve is the:
A. minimum amount of currency banks must hold in their vaults. B. maximum amount of currency banks are allowed to hold in their vaults. C. minimum ratio of reserves to bank deposits that commercial banks are allowed to maintain. D. maximum ratio of reserves to bank deposits that commercial banks are allowed to maintain.
If U.S. prices increase relative to the rest of the world, we would expect:
A. net exports to increase. B. net exports to decrease. C. net exports to be unaffected. D. government spending to increase.
Which of the following is the correct formula for marginal revenue?
a. Marginal revenue = change in total revenue/change in quantity b. Marginal revenue = change in quantity/change in total revenue c. Marginal revenue = change in price/change in quantity d. Marginal revenue = change in quantity/change in price
Which of the following is not held constant along a demand curve for labor by a firm?
a. the firm's technology of production b. the price of the firm's output c. the marginal product of labor for the firm d. the price of substitutes for the firm's output