Which of the Following Is a Reason Why the Demand

question 61

Multiple Choice

Which of the following is a reason why the demand curve for an item would be more elastic?

• A) The item is a necessity.
• B) People's incomes are very high relative to the cost of the item.
• C) The item has many very good substitutes.
• D) The cost of the item forms a very small part of consumers' budgets.

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Definitions:

Lessee

The user of an asset in a leasing agreement. The lessee makes payments to the lessor.

Title

A legal term denoting ownership rights over property, assets, or legal documents.

CRA

An abbreviation that can stand for Credit Rating Agency, an organization providing assessments of the creditworthiness of securities or firms.

Fair Market Value

The price that property would sell for on the open market, considering both the seller and buyer are acting knowledgeably and without undue pressure.