When a Demand Curve Is Linear

question 127

Multiple Choice

When a demand curve is linear:

• A) demand is elastic at low prices.
• B) demand is inelastic at low prices.
• C) demand is unitary elastic at low prices.
• D) the elasticity is constant at all prices.

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Definitions:

Decision

The act of making a choice or coming to a conclusion.

Investment Turnover

A financial ratio that measures how effectively a company uses its assets to generate sales revenue; a higher turnover indicates better performance.

Profit Margin

The ratio of net income to revenue, indicating how much profit is generated per dollar of sales.

Return on Investment

A financial metric used to assess the profitability or efficiency of an investment, calculated by dividing the benefit (return) of an investment by the cost of the investment.