The Value of Price Elasticity of Demand for a Normal

question 11

Multiple Choice

The value of price elasticity of demand for a normal commodity is negative because it indicates:

• A)the inverse relationship between the price and the quantity demanded for the commodity.
• B)that the value of the consumer surplus is negative for a normal good.
• C)that the changes in quantity demanded are much less compared to the changes in price for a normal good.
• D)the direct relationship between price and consumer surplus from the commodity.

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Definitions:

Unconditioned Response

is an automatic, natural reaction to a stimulus that occurs without the need for prior learning or conditioning.

Conditioned Stimulus

A previously neutral stimulus that, after becoming associated with an unconditioned stimulus, eventually comes to trigger a conditioned response.

Neutral Stimulus

A stimulus that initially produces no specific response other than focusing attention, until it becomes associated with an unconditioned stimulus through classical conditioning.

Classical Conditioning

A learning process that occurs through associations between an environmental stimulus and a naturally occurring stimulus.