The Price Elasticity of Demand Tends to Be Higher for Goods

question 162

Multiple Choice

The price elasticity of demand tends to be higher for goods

• A)for which the consumer spends a high percentage of his or her income.
• B)for which the consumer spends a low percentage of his or her income.
• C)that are in abundant supply.
• D)that are in scarce supply.

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Definitions:

Drawing Account

An account used to record withdrawals made by a business owner or partner from the company for personal use.

Balance Sheet Debit

An entry on the left side of a balance sheet, typically indicating an increase in assets or a decrease in liabilities or equity.

Net Income

Profits after subtracting all costs, including operating expenses, interest, and taxes, from total revenue, indicating the final earning outcome of a business.

Adjusted Trial Balance

A financial report that lists all the account titles and balances of a company after adjusting entries are made, used for the preparation of financial statements.