Exhibit 39-4 -Refer to Exhibit 39-4.The Price Elasticity of Demand for Wheat

question 11

Multiple Choice

Exhibit 39-4
-Refer to Exhibit 39-4.The price elasticity of demand for wheat between the prices of $3 and $4 is

• A)equal to 1.
• B)less than 1.
• C)greater than 1.
• D)equal to 100.
• E)c and d

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Definitions:

Interest Rate

The fee, represented as a percentage of the total amount lent, that a lender imposes on a borrower for the utilization of assets.

Quantity of Money Demanded

The total amount of money that households and businesses wish to hold at a given time, depending on interest rates, income levels, and economic activity.

Money Supply Curve

A graphical representation that shows the relationship between the quantity of money in the economy and the interest rate.

Interest Rate

The percentage charged on the total amount you borrow or earn on an investment over a specific period of time.