Which of the Following Statements Is True

question 64

Multiple Choice

Which of the following statements is true ?

• A) If the income elasticity of demand is less than zero, the good is an inferior good.
• B) Only if the demand curve is vertical will sellers raise the price by the full amount of a tax.
• C) Two goods are substitutes if the cross-elasticity of demand coefficient is positive.
• D) A price elasticity of supply coefficient equal to 1.5 means the product exhibits an elastic supply and a 10 percent increase in the price will increase the quantity supplied by 15 percent.
• E) All of the above.

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Definitions:

Control Group

In experimental research, a group of subjects that does not receive the treatment being tested, used for comparison against the group that does.

Random Sampling

A technique for selecting a sample from a population in a way that every member has an equal chance of being chosen.

Educated Guess

An assumption or prediction made based on known facts and logical reasoning, despite the absence of complete information.

Empirical Evidence

Information acquired by observation or experimentation that is used to confirm or disprove a hypothesis or theory.