Luxury Items Tend to Have ________ Demand, and Necessities Tend

question 50

Multiple Choice

Luxury items tend to have ________ demand, and necessities tend to have ________ demand.

• A) relatively elastic; inelastic
• B) relatively inelastic; elastic
• C) perfectly elastic; perfectly inelastic
• D) unit elastic; perfectly inelastic

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Definitions:

Performance Obligation

A duty or commitment that a company must fulfill to transfer a promised good or service to a customer.

Sales Returns And Allowances

Sales returns and allowances account for the reduction in sales revenues due to returned or defective products allowed by a company to its customers.

Sales Discounts

Reductions in the price of goods or services offered to customers, typically in exchange for early payment.

Expense Accounts

Accounts used to track the costs incurred in a business's operational activities, not directly tied to the production of goods or services.