Pierre Says That He Will Spend Exactly 75 Cents a Day

question 415

Multiple Choice

Pierre says that he will spend exactly 75 cents a day on candy bars,regardless of the price of candy bars.Pierre's demand for candy bars is

• A) perfectly elastic.
• B) unit elastic.
• C) perfectly inelastic.
• D) None of the above answers is correct.

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Definitions:

Economic Profits

The profit a firm makes after deducting both its explicit and implicit costs, reflecting the total opportunity costs of all resources used.

Yearly Return

The total gain or loss on an investment over a one-year period, expressed as a percentage of the investment's initial value.

Variable Costs

Expenditures that adjust in relation to the level of production.

Fixed Costs

Costs that do not vary with the level of output produced by a firm, such as rent, salaries, and insurance premiums.