Figure 7-3 Figure 7-3 Depicts a Demand Curve with a Price Elasticity

question 24

Multiple Choice

Figure 7-3
Figure 7-3 depicts a demand curve with a price elasticity that is

• A) perfectly elastic, implying that consumers will purchase as much as can be supplied at the market price.
• B) relatively inelastic, implying that a percent increase in price results in a smaller percent reduction in sales.
• C) unitary, implying that a percent change in price leads to an equal percent change in quantity demanded.
• D) perfectly inelastic, implying that the same amount will be purchased regardless of the price of the good.

---

Definitions:

Market Savvy

An understanding of market trends and consumer behavior, often reflecting an ability to make strategic business decisions.

Local Context

The specific cultural, economic, social, and political environment or conditions of a particular area or community.

Customer Needs

The requirements or desires of consumers that a company aims to fulfill with its products or services.

Functional Excellence

Superior performance and efficiency in specific business functions, such as marketing, operations, or finance.