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When Does a Decrease in Supply Raise the Price More

question 89

Essay

When does a decrease in supply raise the price more: When demand is elastic or when demand is inelastic? When OPEC decreases the supply of oil, the price of gasoline skyrockets. Hence is the demand for gasoline elastic or inelastic?


Definitions:

Control Account

An account used to summarize and control the total of individual subsidiary ledger accounts, such as accounts receivable or accounts payable, facilitating the integrity of financial information.

Subsidiary Ledger

A detailed ledger that contains the individual accounts with a common characteristic, linked to a general ledger account.

Accounting Information System

A system used to collect, store, manage, process, retrieve, and report financial data for the users.

Manual Accounting System

A system in which someone performs each of the steps in the accounting cycle by hand.

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