Business People Often Speak About Price Elasticity Without Actually Using

question 19

Multiple Choice

Business people often speak about price elasticity without actually using the term. Which statement describes a good with an elastic demand?

• A) "A price cut won't help me. It won't increase my sales, and I'll just get less money for each unit."
• B) "I don't think a price cut will help my bottom line any. Sure, I'll sell a bit more, but I'll more than lose because the price will be lower."
• C) "My customers are real shoppers. After I cut my prices just a few cents below those my competitors charge, customers have been flocking to my store and sales are booming."
• D) "The economic expansion has done wonders for my sales. With more people back at work, my sales are taking off!"

---

Definitions:

Insider Trading

The illegal practice of trading on the stock exchange to one's own advantage through having access to confidential information.

U.S. Department Of Defense

The federal department charged with coordinating and supervising all agencies and functions of the government relating directly to national security and the United States armed forces.

Internet

A global system of interconnected computer networks that use the Internet protocol suite to communicate between networks and devices, facilitating information sharing and communication.

Offshoring

The relocation of a business process or operation from one country to another, typically to leverage lower labor costs.