If an Increase in the Price of a Product from $1

question 144

Multiple Choice

If an increase in the price of a product from $1 to $2 per unit leads to a decrease in the quantity demanded from 100 to 80 units, then demand is:

• A) elastic.
• B) inelastic.
• C) of unitary elasticity.
• D) 0.
• E) inferior.

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Definitions:

Patents

Legal documents granting an inventor exclusive rights to produce, use, and sell their invention for a certain period, preventing others from copying.

Long-Run Supply Curve

A graphical representation that shows how the quantity of goods supplied by an industry changes over time in response to changes in price, assuming that all inputs can be varied.

Increasing-Cost Industry

An industry in which the costs of production increase as the industry's output expands, typically due to resource limitations or increased demand for inputs.