If Your Demand for a Good Is ________, Then a 1

question 310

Multiple Choice

If your demand for a good is ________, then a 1 percent fall in its price will lead you to ________ your expenditures on the good.

• A) inelastic; increase
• B) inelastic; decrease
• C) elastic; increase
• D) elastic; decrease

---

Definitions:

Loan

A quantity of money that is lent and is supposed to be repaid along with an additional amount as interest.

Compounded Monthly

The process of calculating interest on both the initial principal and the accumulated interest from previous periods on a monthly basis.

Monthly Savings

The amount of money saved each month after all expenses have been paid.

Interest Rate

The cost of borrowing money or the return on investment, typically expressed as a percentage of the principal.