Assume the Demand for High Tech Good Is Perfectly Inelastic

question 32

Multiple Choice

Assume the demand for high tech good is perfectly inelastic. If workers producing high tech goods become more productive, then these workers employment will ________ and their wages will ________.

• A) fall, rise
• B) fall, fall
• C) rise, rise
• D) rise, fall

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Definitions:

Price

The amount of money or consideration exchanged for the ownership or use of a good or service.

Business

An organization or enterprising entity engaged in commercial, industrial, or professional activities, often structured to produce and sell goods and services for profit.

Present Value

Present value represents the current value of a future amount of money or series of cash flows, discounted at a certain rate of return.

Discount Rate

In finance, the rate used to discount future cash flows to their present value, essentially reflecting the time value of money and risk.