Microsoft Raises the Price of Its Office Software by 10

question 62

Multiple Choice

Microsoft raises the price of its Office software by 10 per cent. As a result, the quantity of personal computers demanded at the current price decreases by 5 per cent. What is the cross elasticity of demand for personal computers with respect to the price of Microsoft Office software?

• A) 2.0
• B) - 2.0
• C) 0.5
• D) - 0.5

Understand how changes in capital (like machinery or technology) affect optimal labor employment.

Calculate the optimal level of labor employment based on marginal product of labor, wage rates, and marginal revenue.

Analyze the impact of wage rate changes on the employment of labor.

Understand the role of technology in modifying the marginal product of labor.

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Definitions:

Book Of Vouchers

A ledger or book that contains vouchers, which are documents or files acting as evidence for transactions.

Gross Method

A method of recording purchases of inventory at their gross price without any deduction for trade discounts at the time of purchase.

Periodic Inventory Method

An accounting approach where inventory values and cost of goods sold are determined at the end of an accounting period through physical inventory counts.

Purchases Discount

A reduction in the invoice price of goods, granted by the seller to the buyer for early payment within a specified time frame.