What Happens If Sellers Respond Substantially to Changes in Price

question 156

Multiple Choice

What happens if sellers respond substantially to changes in price

• A)The supply curve will shift substantially when the price rises.
• B)Sellers are considered to be relatively price insensitive.
• C)Sellers are considered to be relatively price sensitive.
• D)The price elasticity of supply equals 1.

Comprehend the different components of the income statement and their relationship with net income.

Understand the basic differences between merchandising and service businesses in terms of financial statements.

Comprehend how to calculate gross profit and operating income.

Recognize the differences in accounting for inventory in a merchandising business.

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Definitions:

Purchase

The process of purchasing products or services.

Dispose

The act of getting rid of something, typically something that is no longer useful or desired.

Psychographics

Psychographics involves the study of consumers' lifestyles, interests, attitudes, and values to understand their purchasing behavior.

Lifestyles

The aggregation of choices, behaviors, and attitudes by which individuals express their personal values, interests, and social identities.