The Price Elasticity of Demand Is Typically Expressed as a Positive

question 59

Multiple Choice

The price elasticity of demand is typically expressed as a positive number because:

• A)price and quantity move in the same direction.
• B)the demand curve has a positive slope.
• C)it's convenient to use absolute values.
• D)both the numerator and the denominator are negative, so the formula yields a positive number.

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Definitions:

Retained Earnings

The segment of net profits that are not distributed as dividends, instead kept within the company for reinvestment in its main operations or for debt repayment.

Current Asset

A slightly different term for assets likely to be used or turned into cash within one fiscal year or operating cycle, emphasizing liquidity.

Land

An asset representing the earth's surface that a company owns, used for operations, development, or investment.

Liquidity

The ease with which an asset can be converted into cash without significantly affecting its price, reflecting a company's ability to meet short-term obligations.