Assume That as a Firm Decreases Its Price Its Total

question 117

Multiple Choice

Assume that as a firm decreases its price its total revenue decreases. Which of the following is a possible value of its price elasticity of demand?

• A) 0.4
• B) 1
• C) 1.4
• D) 4

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Definitions:

Stimuli

External or internal factors that elicit a response or reaction from organisms.

Automatic Response

An involuntary reaction to a stimulus that occurs without conscious thought as a result of learning or biological predisposition.

Rooting

A reflex in infants that prompts them to turn their head towards anything that touches their cheek, aiding in the act of breastfeeding.

Eyeblink

A rapid closing and opening of the eyelid, often reflexive to protect the eye from foreign bodies or bright lights.