If Demand Hardly Changes with a Small Change in Price,we

question 116

Multiple Choice

If demand hardly changes with a small change in price,we say that the demand is ________.

• A) equal
• B) marginal
• C) inelastic
• D) elastic
• E) none of the above

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Definitions:

Contribution Margin

The amount by which sales revenue exceeds variable costs, indicating how much contributes to covering fixed costs and generating profit.

Capital Intensive

Describes industries or businesses that require large amounts of investment in heavy machinery, equipment, or other capital assets to produce goods or services.

Margin of Safety

The difference between actual or projected sales and the break-even point, indicating the level of risk in meeting profitability targets.

Margin of Safety

The difference between actual or projected sales and the break-even point, indicating the amount of sales decline a business can tolerate.