If the Quantity Demanded of a Certain Good Responds Only

question 263

Multiple Choice

If the quantity demanded of a certain good responds only slightly to a change in the price of the good,then the

• A)demand for the good is said to be elastic.
• B)demand for the good is said to be inelastic.
• C)law of demand does not apply to the good.
• D)demand curve for the good shifts only slightly in response to a change in price.

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Definitions:

Income

The money received, usually on a regular basis, for work or through investments.

Interest Rate

The segment of a loan levied as interest upon the borrower, customarily indicated as an annual proportion of the loan yet to be repaid.

Utility Function

A representation in economics that expresses the preference ordering of various utility levels or consumption bundles by individuals or firms.

Consumption

The use of goods and services by households or individuals, often analyzed to understand economic activity and consumer behavior.