When National Income Falls, Sales of Vacation Packages Also Fall

question 7

Multiple Choice

When national income falls, sales of vacation packages also fall, even at constant prices. This fact suggests that the _ _ elasticity of demand for vacation packages is .

• A) cross; positive
• B) income; positive
• C) income; negative
• D) price; negative
• E) price; positive

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Definitions:

Deferred Gain

A gain that is realized for accounting purposes but not yet recognized for tax purposes, or a gain that is spread over time by various accounting methods.

Expected Return

Expected return is the anticipated amount of profit or loss an investment generates, based on historical data or probabilistic estimates.

Pension Trustee

An individual or a corporate entity that holds and manages the assets of a pension fund on behalf of the participants.

Journal Entries

The method used in accounting to record each financial transaction of a company, represented by debits and credits in the financial records.