When a Small Percentage Change in Price Causes a Large

question 30

Multiple Choice

When a small percentage change in price causes a large percentage change in the quantity demanded,we say that they have a:

• A)highly elastic demand.
• B)highly inelastic demand.
• C)low magnitude of response.
• D)high magnitude of response.

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Definitions:

Customized Tool

A tailored or specially made instrument or software designed to meet the specific needs of a user or task.

Required Return

The minimum return that an investor expects to achieve by investing in a particular asset, taking into account the asset's risk.

Straight-Line Depreciation

A method of allocating the cost of a tangible asset over its useful life in an equal annual amount.

Net Working Capital

The difference between a company's current assets and current liabilities.