The Most Commonly Used Measures of Elasticity Are

question 53

Multiple Choice

The most commonly used measures of elasticity are:

• A) income elasticity of demand and price elasticity of supply.
• B) price elasticity of demand and price elasticity of supply.
• C) cross-price elasticity of demand and cross-price elasticity of supply.
• D) price elasticity of demand and cross-price elasticity of supply.

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Definitions:

Price Rigidity

Characteristic of oligopolistic markets by which firms are reluctant to change prices even if costs or demands change.

Demand Curve

Depicts how the quantity demanded of a commodity varies with its price, commonly shown as a downward-sloping line on a graph, reflecting the inverse relationship between price and quantity demanded.

Price Leadership

Pattern of pricing in which one firm regularly announces price changes that other firms then match.

Oligopolistic Firms

Companies operating in a market structure characterized by a small number of firms controlling a large market share, often leading to limited competition.