How Much the Demand for One Good Changes in Response

question 95

Multiple Choice

How much the demand for one good changes in response to a change in the price of a different good is measured by:

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

---

Definitions:

Equivalent Units

A concept in cost accounting that converts partially completed units into a comparable number of fully completed units.

Conversion Costs

The sum of labor and overhead costs that are necessary to turn raw materials into finished products.

FIFO Method

First In, First Out; an inventory valuation method where the costs of the earliest goods purchased or produced are the first to be expensed.

Process Costing

A method of costing used for homogenous products, where it calculates the cost of each process or stage of production.