A Decrease in Price

question 115

Multiple Choice

A decrease in price:

• A) causes a decrease in total revenue due to the quantity effect.
• B) causes an increase in total revenue due to the price effect.
• C) does not cause a quantity effect when demand is perfectly inelastic.
• D) does not change quantity demanded if demand is elastic.

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Definitions:

Chi-square Statistic

A measure used in statistics to assess how expectations compare to actual observed data, especially in categorical data analysis.

Significance Level

The probability threshold below which the null hypothesis is rejected, often denoted by alpha.

Level of Significance

In statistical hypothesis testing, it is the criterion used for deciding whether to reject the null hypothesis, often represented by alpha (α) and set before the study.

Significant Results

Findings in research that are unlikely to have occurred by chance alone, indicating a notable difference or effect that is statistically significant.