Firms like to know the price elasticity of demand because it determines how price changes affect:
A. the supply curve.
B. costs.
C. revenues.
D. taxes.
Answer: C
You might also like to view...
Capitalists like Henry Ford welcomed the Fair Labor Standards Act of 1938 . It relieved them of the responsibilities associated with contracting wages, hours and working conditions
Indicate whether the statement is true or false
For which of the following medical services is the income elasticity of demand likely to be the smallest?
a. face-lifts b. plastic surgery c. manicures d. emergency services after a car accident e. hair transplants
If an economy is closed and if it has no government, then
a. national saving = private saving. b. total income = consumption + investment. c. saving = total income - consumption. d. All of the above are correct.
Exhibit 3-3 Demand curves
Assume that crackers and soup are complementary goods. Which of the graphs in Exhibit 3-3 depicts the effect of a promotional discount that decreases the price of crackers on the demand for soup?
A. Graph A. B. Graph B. C. Graph C. D. Graph D.