Which of the Following Is Likely to Have the Smallest

question 155

Multiple Choice

Which of the following is likely to have the smallest price elasticity of demand?

• A) an automobile
• B) a new automobile
• C) a new Ford automobile
• D) a new Ford Mustang

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Definitions:

Optimal Level

The most favorable or efficient level of output or activity under given conditions, maximizing benefits or minimizing costs.

Public Good

A good that is non-excludable and non-rivalrous, meaning it can be used by everyone and one person's use does not diminish another's.

Free-rider Problem

A situation where individuals consume a good without contributing to its cost, typically in the context of public goods.

Public Good

A good or service offered to every member of a community for free, supplied by either governmental bodies or private entities without the intention of making a profit.