Suppose One Market Demand (D₁) Has a Price Elasticity of .65

question 25

Multiple Choice

Suppose one market demand (D₁) has a price elasticity of .65 and a second market demand (D₂) has a price elasticity of .80. In comparing price elasticities of demand, it is proper to say that

• A)D₂ is elastic compared to D₁.
• B)D₂ is inelastic compared to D₁.
• C)D₂ is more inelastic than D₁.
• D)D₂ is more elastic than D₁.
• E)the elasticity of D₁ and D₂ is the same.

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Definitions:

Weighted-Average Method

An inventory costing method that calculates the cost of ending inventory and the cost of goods sold based on the average cost of all inventory units.

Process Costing System

An accounting method used to assign costs to units of production in industries where the production process is continuous.

Ending Work In Process

The balance of unfinished goods at the end of an accounting period, which includes material, labor, and overhead costs incurred.

Cost Reconciliation Report

A financial document summarizing the cost elements of a production process, including materials, labor, and overhead, to reconcile any variances between expected and actual costs.