Suppose Demand Is Perfectly Inelastic,and the Supply of the Good

question 300

Multiple Choice

Suppose demand is perfectly inelastic,and the supply of the good in question decreases.As a result,

• A)the equilibrium quantity decreases,and the equilibrium price is unchanged.
• B)the equilibrium price increases,and the equilibrium quantity is unchanged.
• C)the equilibrium quantity and the equilibrium price both are unchanged.
• D)buyers' total expenditure on the good is unchanged.

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Definitions:

Mailbox Rule

A legal principle that an offer is considered accepted once the acceptance is dispatched by the offeree, not when it is received by the offeror.

Dispatched

The process of sending off to a destination or for a purpose, often used in contexts of mail, orders, or tasks being sent out or completed.

Insurance Company

A business entity that provides financial protection or reimbursement against losses to individuals or entities, in exchange for the payment of premiums.

Merchants

Individuals or entities involved in the wholesale or retail purchase and sale of goods, often specialized in a particular trade or business.