Refer to the Information Provided in Figure 5

question 16

Multiple Choice

Refer to the information provided in Figure 5.3 below to answer the question(s) that follow. Figure 5.3
-Refer to Figure 5.3. Use the midpoint formula. If the price of a gardenburger decreases from $9 to $8, the price elasticity of demand equals ________ and demand is ________.

• A) 6.33; elastic
• B) -0.16; inelastic
• C) -6.33; elastic
• D) -19.0; inelastic

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Definitions:

Gross Profit

The difference between sales revenue and the cost of goods sold before accounting for administrative and selling expenses.

Units

A measure of quantity or amount in accounting, production, or inventory management, often used to quantify items, products, or resources.

After-tax Income

The amount of income left after all federal, state, and withholding taxes have been deducted.

Tax Rate

The rate at which taxes are levied on the income of a person or company.