The Price Elasticity of Demand for Mobile Phones

question 282

Multiple Choice

The price elasticity of demand for mobile phones

• A)will be higher if there is an improvement in the production technology.
• B)will be lower if consumers perceive mobile phones to be a necessity.
• C)is computed as the percentage change in the price of mobile phones divided by the percentage change in quantity of mobile phones.
• D)All of the above are correct.

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Definitions:

Constrained Resource

A factor of production that limits the output or growth of a process, such as limited raw materials, labor, or machine capacity.

Profitable Use

Utilizing resources or an asset in a manner that generates a favorable financial return.

Current Profitability

A measure of a firm's current financial performance, often assessed by examining current income and profitability ratios.

Emphasized

Highlighted or given special attention or prominence in a context or discussion.