Economists Estimated That the Price Elasticity of Beer Is -0

question 74

Multiple Choice

Economists estimated that the price elasticity of beer is -0.17 and the income elasticity of beer is -0.05.This means that

• A)an increase in the price of beer will increase the quantity demanded of beer and beer is a normal good.
• B)an increase in the price of beer will lead to an increase in revenue for beer sellers and beer is an inferior good.
• C)a decrease in the price of beer will lead to an increase in revenue for beer sellers and beer is an inferior good.
• D)an increase in the price of beer will lead to a decrease in the quantity demanded of beer and beer is a necessity.

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Taxpayers

Individuals and entities that are required to pay taxes to government authorities, based on income, property ownership, or consumption.

Export Subsidies

Financial support from the government to companies for the purpose of encouraging exports of goods to foreign countries.

Agricultural Products

Goods derived from farming and agriculture, including food items, feed, fiber, and biofuel commodities.

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Taxes imposed by a government on imported or occasionally exported goods, often used to protect domestic industries from foreign competition.