The Demand for Orange Juice Is Price Elastic

question 160

Multiple Choice

The demand for orange juice is price elastic. A severe frost, which destroys large quantities of oranges will

• A)lower the equilibrium price but increase total consumer spending on juice.
• B)decrease the equilibrium quantity and decrease total consumer spending on juice.
• C)decrease both the equilibrium quantity and the price of juice.
• D)raise the equilibrium price as well as total consumer spending for juice.
• E)raise the equilibrium price but leave total consumer spending for juice constant.

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Definitions:

Central Government

The national government of a federated state, possessing ultimate governmental authority over the entire country.

Government Program

An initiative funded and operated by a government body aimed at achieving a specific social, economic, or political purpose.

National Government

The government that oversees the entire nation, as opposed to local or regional governments.

Dual Federalism

A political system where the responsibilities and powers are clearly divided between the national and state governments.