A Lower Price Elasticity of Demand Coefficient Occurs When

question 69

Multiple Choice

A lower price elasticity of demand coefficient occurs when:

• A)the good has less substitutes.
• B)the fall in price is fully compensated by increase in quantity.
• C)the fall in price causes the total revenue to increase.
• D)there is a strong competition among producers.

---

Definitions:

Stock Dividend

A payment made to shareholders in the form of additional shares, rather than cash, reflecting the company's decision to reinvest the profit.

Liability

A company's legal financial debts or obligations that arise during the course of business operations.

Retained Earnings

Profits that a company has decided to keep and reinvest in the business rather than distribute to shareholders.

Common Dividend Payable

A liability on the balance sheet representing the amount of dividends declared by a company's board of directors to be distributed to common shareholders.