Inelastic Demand Is a Situation in Which

question 77

Multiple Choice

Inelastic demand is a situation in which

• A) an increase or a decrease in price does not significantly affect the demand for a product.
• B) prices are adjusted over time to maximize a company's revenues.
• C) demand is created for new products by aggressive brand awareness campaigns.
• D) a pricing objective maintains existing prices or meets the competition's prices.

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Definitions:

Primacy Effect

A cognitive bias that results in a person recalling information presented at the beginning of a list better than information in the middle or end.

Selective Attention

The cognitive process of focusing on a particular object, event, or process while ignoring others, in a limited capacity of awareness.

Contrast Effect

A cognitive bias where the difference between two things is exaggerated because they are compared directly to each other.

Perceptual Distortion

A cognitive bias that affects how one perceives reality, often leading to inaccuracies or misinterpretations.