There Is No Total Revenue Test for Price Elasticity of Supply

question 73

Multiple Choice

There is no total revenue test for price elasticity of supply because:

• A)price and quantity are usually inversely related.
• B)price and quantity are usually positively related.
• C)total revenue will not usually change in the direction of a supply price
• D)change.price and quantity are always negatively related.

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Definitions:

Standard Deviation

A measure of the amount of variation or dispersion of a set of values, commonly used in finance to quantify the risk associated with a given investment.

Perfectly Negatively Correlated

A situation in which two variables move in opposite directions with a correlation coefficient of -1, implying that when one variable increases, the other decreases.

Risk-Free Portfolio

An investment group that is considered to have no risk of financial loss, typically represented by government bonds.

Expected Rate

The return that an investor anticipates or forecasts receiving on an investment over a set period.