The Introduction of the AMD Athlon Microprocessor Has ______ the Price

question 27

Multiple Choice

The introduction of the AMD Athlon microprocessor has ______ the price elasticity of demand for Intel Celeron microprocessors,and hence ______ Intel's ability to raise revenue through price increases.

• A) increased;reduced
• B) increased;increased
• C) lower;reduced
• D) lower;increased
• E) had no effect on;reduced

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Definitions:

Inelastic Portion

Part of the demand curve where consumers are less sensitive to price changes, meaning that the quantity demanded changes little with a significant price change.

Price Elasticity

The determination of demand elasticity for a product relative to changes in its price.

Constant Slope

A line on a graph that has the same steepness throughout, indicating a uniform rate of change.

Price Elasticity

Price elasticity measures how the quantity demanded or supplied of a good changes in response to a change in its price.