Assume That the Demand Curve for Sunblock Is Linear and Downward

question 170

Multiple Choice

Assume that the demand curve for sunblock is linear and downward sloping.Which of the following statements about the slope of the demand curve for sunblock and the price elasticity of demand for sunblock is true?

• A)The slope and the price elasticity of demand are constant at all points along the demand curve for sunblock.
• B)The slope is constant, but the price elasticity of demand is not constant at all points along the demand curve for sunblock.
• C)The slope is not constant, but the price elasticity of demand is constant at all points along the demand curve for sunblock.
• D)The slope of the demand curve for sunblock is constant and equal to zero; demand is perfectly inelastic.

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Definitions:

Maturity

The date on which a debt or other borrowing is due to be repaid in full, or when an investment reaches its full value.

Bond's Discount

The difference between the face value of a bond and its selling price when sold for less than its face value.

Amortized

The gradual reduction of a debt over a period of time by making regular payments of interest and principal sufficient to repay the loan by maturity.

Straight-Line Method

Straight-Line Method is a form of calculating depreciation or amortization by evenly spreading the cost of an asset over its useful life.