Price Elasticity of Demand and Price Elasticity of Supply Are

question 148

Multiple Choice

Price elasticity of demand and price elasticity of supply are both influenced by

• A)the availability of close substitutes for the product
• B)the proportion of the consumer's budget spend on the product
• C)the length of the adjustment period considered
• D)technological conditions such as the additional costs of increasing production
• E)none of the above

---

Definitions:

Equilibrium Quantity

The quantity of goods or services that is supplied and demanded at the equilibrium price, where market supply and demand balance each other.

SRAS Curve

Short-Run Aggregate Supply curve, representing the relationship between the total supply of goods and services and the price level in the short run.

Real GDP

The measure of the value of all final goods and services produced within a country adjusted for inflation or deflation.

DSO

Stands for Days Sales Outstanding, a measure used by companies to assess the average number of days it takes to collect payment after a sale has been made.