If a Large Percentage Increase in the Price of a Good

question 141

Multiple Choice

If a large percentage increase in the price of a good results in a small percentage reduction in the quantity demanded of the good, demand is said to be

• A) of unitary elasticity.
• B) relatively inelastic.
• C) relatively elastic.
• D) perfectly elastic.

---

Definitions:

Interest Payment

The payment made to a lender by a borrower in return for the use of borrowed money, typically represent a fixed percentage of the principal.

Book Value

The net value of a company's assets, calculated as total assets minus intangible assets (patents, goodwill) and liabilities.

Straight-line Amortization

A method of evenly spreading the cost of an intangible asset over its useful life.

Interest Payment

The amount paid by a borrower to a lender for the use of borrowed money, typically expressed as an annual percentage.