Which of the Following Is a Determinant of the Price

question 328

Multiple Choice

Which of the following is a determinant of the price elasticity of demand for an item?

• A) The availability of a close substitute for the item
• B) The percentage of a consumers budget allocated to expenditures on the item
• C) The amount of time available to adjust to a change in the price of the item
• D) All of the above are correct

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Definitions:

Preferred Shareholders

Investors who own preferred shares in a company, giving them priority over common shareholders in the distribution of dividends and assets in the event of liquidation, but typically without voting rights.

Dividends

Payments made by a corporation to its shareholder members, distributed from the company's profits.

Preemptive Right

A shareholder's right to maintain their proportional ownership in a company by purchasing additional shares before they are offered to the public.

Common Stock

A form of corporate equity ownership, a type of security representing an ownership stake in a corporation.