Figure 7-8 -For a Price Increase from $10 to $11, the Price

question 140

Multiple Choice

Figure 7-8
-For a price increase from $10 to $11, the price elasticity of the demand curve depicted in Figure 7-8 is

• A) highly inelastic.
• B) relatively inelastic.
• C) approximately equal to −1.
• D) approximately equal to −2.

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Definitions:

Dividend Yield

A finance ratio illustrating the yearly dividends paid by a company in comparison to its stock price.

Capital Gains Yield

The dividend growth rate or the rate at which the value of an investment grows.

Cost of Capital

The rate of return that a company must pay to its creditors and shareholders for using their capital.

Income Return

A measure of the income generated by an investment, usually expressed as a percentage of the investment's cost.