Business People Speak About Income Elasticity of Demand Without Using

question 109

Multiple Choice

Business people speak about income elasticity of demand without using the actual term.Which one of the following statements reflects income elasticity of demand?

• A)"A price cut won't help me.It won't increase sales, and I'll just get less money for each unit."
• B)"I don't think a price cut will make any difference to my bottom line.What I may gain from selling more I would lose on the lower price."
• C)"My customers are real bargain hunters.Since I set my prices just a few cents below my competitors, customers have flocked to the store and sales are booming."
• D)"With the recent economic recovery, people have more income to spend and sales are booming, even at the previous prices."
• E)both A and B

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Definitions:

Toes

The digits of the foot in humans and other animals, involved in locomotion and balance.

Shoes

Footwear designed to protect and comfort the human foot while doing various activities, also serving as an item of decoration or fashion.

Positively Correlated

Refers to a relationship between two variables where they move in the same direction, meaning as one variable increases, the other also increases, and vice versa.

Diet Drug

A medication or supplement intended to help in weight loss by suppressing appetite, increasing metabolism, or preventing fat absorption.