When the Price of Designer Jeans Goes from $85 to $60

question 167

Multiple Choice

When the price of designer jeans goes from $85 to $60, the quantity demanded increases from 100,000 to 120,000. Over this price range, the

• A) demand for the jeans is elastic.
• B) demand for the jeans is inelastic.
• C) demand for the jeans is of unitary elasticity.
• D) arc elasticity of demand for the jeans is − 4.

---

Definitions:

Stockholders' Equity

The portion of a company's assets that belongs to its shareholders, calculated as total assets minus total liabilities.

Cost of Goods Sold

The direct costs attributable to the production of goods sold by a company, including material and labor costs.

Law Firm

A business entity formed by one or more lawyers to engage in the practice of law, providing advice to clients and representing them in legal matters.

Expense Accounts

Accounts used to track the expenditures incurred by a business, categorized for financial reporting and analysis.