If the Demand for a Good Is Unit Elastic, Then

question 48

Multiple Choice

If the demand for a good is unit elastic, then a 5 percent increase in price results in

• A)a 5 percent increase in total revenue.
• B)a 5 percent decrease in total revenue.
• C)no change in total revenue.
• D)an increase in total revenue greater than 5 percent.
• E)an increase in total revenue less than 5 percent.

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Definitions:

Depreciation

The allocation of the cost of a tangible asset over its useful life, reflecting the decrease in value over time due to usage, wear and tear, or obsolescence.

Accumulated Depreciation

The total depreciation amount that has been charged against a fixed asset's cost over its useful life to reflect wear and tear.

Equipment

Tangible property owned by a business used in operations, such as machinery, vehicles, or computers.

Balance

The difference between the total debits and credits in an account, or the equilibrium between two opposing forces or aspects.