The Important Determinants of the Price Elasticity of Demand Are

question 18

Multiple Choice

The important determinants of the price elasticity of demand are the

• A) number and closeness of available substitutes, importance in consumers' budgets, and length of the time period.
• B) number of markets, size of buyers' incomes, and empirical validity.
• C) number of firms, number of variables that must be held constant, and degree to which markets are separable.
• D) scope and method of measurement and calculation and transitivity of preferences.
• E) state of technology, size of the firm's plants, and size of the absolute change in input prices and quantity.

---

Definitions:

Consumer Surplus

The contrast between the overall amount consumers are willing to pay for a good or service and the total they actually pay.

Supply

The total amount of a good or service that producers are willing and able to sell at a given price over a certain period.

Consumer Surplus

The rift between what consumers are economically prepared to spend on a service or product and their actual spending.

Consumer Surplus

The divergence between the total consumers can and are willing to pay for a product or service and what they truly pay.