If a Large Percentage Change in Price Leads to a Smaller

question 123

Multiple Choice

If a large percentage change in price leads to a smaller percentage change in quantity demanded, the good has a

• A) very elastic demand.
• B) less elastic demand.
• C) low magnitude of response.
• D) high magnitude of response.

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Definitions:

Notes Receivable

A customer’s written promise to pay an amount and possibly interest at an agreed-upon rate.

Allowance Method

The method of accounting for uncollectible accounts that provides an expense for uncollectible receivables in advance of their write-off.

Receivables

All money claims against other entities, including people, business firms, and other organizations.

Written Off

The process of recognizing that a portion of a company's assets or receivables has decreased in value and is unlikely to be recovered, thus removing it from the balance sheet.