If a Firm Wanted to Know Whether the Demand for Its

question 58

Multiple Choice

If a firm wanted to know whether the demand for its product was elastic, unit elastic, or inelastic, then the firm could

• A)survey competitors and ask them what they think demand elasticity is for the product.
• B)talk to its customers.
• C)change price a little bit and observe what happens to total revenue.
• D)not do anything as there is no way to find an elasticity value.

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Definitions:

Target Profit

The predetermined amount a business aims to earn over a specific period, used for planning and performance evaluation.

Selling Price

The cost at which customers can purchase a product or service.

Target Profit

The amount of net income a company aims to achieve for a specified period as part of its financial and operational planning.

Unit Sales

The total number of individual units sold by a company in a specific period.