While Shopping at the Supermarket,Selina Was Dismayed to Find That

question 39

Multiple Choice

While shopping at the supermarket,Selina was dismayed to find that the price of orange juice was now 50% more than what she was used to paying.As a result,Selina purchased grapefruit juice,which was closer to what she usually pays.Based on this example,orange juice is

• A) A necessity
• B) A luxury good
• C) Inelastic
• D) Elastic

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Definitions:

Free-Trade Policies

Economic policies that allow imports and exports to occur without restrictive tariffs, quotas, or other barriers to trade.

Protection

The practice of shielding a sector of the economy from foreign competition.

General Agreement on Tariffs and Trade

An international treaty aimed at promoting international trade by reducing or eliminating trade barriers such as tariffs and quotas; it was replaced by the World Trade Organization (WTO) in 1995.

Voluntary Export Restraint

A self-imposed limitation by exporting countries on the volume of their exports of a particular good.