We would expect the own price elasticity of demand for food to be:
A. perfectly inelastic.
B. more elastic than the demand for cereal.
C. the same as that for soap.
D. less elastic than the demand for cereal.
Answer: D
You might also like to view...
Which of the following statements is true?
A) Marginal analysis is a key component in the process of optimization in levels. B) Only direct costs are considered when the net benefits of the alternatives are calculated. C) In both the techniques of optimization, all costs have to be converted to the same unit of measurement. D) Optimization in levels calculates the change in net benefits when a person switches from one alternative to another.
While you were an intern you bought 5 packages of hot dogs a month. After acquiring a full-time job with a considerably higher salary, you stopped purchasing hot dogs. For you, hot dogs are a
a. Complementary good b. Normal good c. Inferior good d. Substitute good
The city of Ann Arbor Michigan buys a police car manufactured in Germany. In the GDP accounts this transaction is included in
a. in government expenditures and exports. b. government expenditures and imports. c. exports, but not government expenditures. d. imports, but not government expenditures.
A demand curve for a normal good
A) slopes upward and to the right. B) is constructed based on the assumption that income is rising. C) is constructed based on the assumption that an inverse relationship exists between price and income. D) shows the inverse relationship between price and quantity demanded.