A Situation in Which There Is a Reduction in Quantity

question 298

Multiple Choice

A situation in which there is a reduction in quantity supplied to zero when there is the slightest decrease in price is

• A) perfectly elastic supply.
• B) perfectly elastic demand.
• C) perfectly inelastic supply.
• D) perfectly inelastic demand.

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Definitions:

Recent Cost

The latest cost incurred for goods or services, reflecting the most up-to-date pricing information.

Inventory

The total amount of goods and materials held by a company with the intent of resale or as part of the production process.

Profit

The financial gain realized when the revenues generated from business activities exceed the expenses and costs incurred in generating those revenues.

Ending Inventory

The total value of all the goods a company has in stock at the end of a fiscal period, which is used to calculate the cost of goods sold.