Which of the Following Statements About Price Elasticity of Demand

question 157

Multiple Choice

Which of the following statements about price elasticity of demand is most accurate?

• A)The more substitutes a product has,the more likely it is to be price elastic.
• B)All products show some price inelasticity.
• C)Nondiscretionary (necessary)purchases are price elastic.
• D)With inelastic demand,reducing price has a very large impact on revenues.
• E)With inelastic demand,manufacturers change prices frequently to capitalize on consumer behavior.

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Definitions:

National Debt

The total amount of money that a country's government has borrowed, typically as a result of budget deficits over years.

Interest Rates

The expense associated with lending money or the incentive for saving it, typically described as a percent of the total amount per year.

Capital Accumulation

The process of acquiring additional assets or wealth, particularly by businesses or the economy, to create further wealth or produce goods and services.

Fiscal Policy

Government policies related to taxation and spending designed to influence economic conditions, including demand, employment, and inflation.