Economists Estimated That the Price Elasticity of Beer Is -0

question 198

Multiple Choice

Economists estimated that the price elasticity of beer is -0.30 and the income elasticity of beer is 0.09. This means that

• A) an increase in the price of beer will increase the quantity demanded of beer and beer is a normal good.
• B) an increase in the price of beer will lead to an increase in revenue for beer sellers and beer is a normal good.
• C) a decrease in the price of beer will lead to an increase in revenue for beer sellers and beer is an inferior good.
• D) an increase in the price of beer will lead to a decrease in the quantity demanded of beer and beer is a necessity.

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Definitions:

AASB 41

The Australian Accounting Standards Board’s standard related to agriculture, which outlines how agricultural companies should account for and report their agricultural activity.

IAS 41

International Accounting Standard 41 is a framework governing the accounting and reporting of agricultural activity.

AASB 120

An Australian accounting standard regarding accounting for government grants and disclosure of government assistance.

IAS 20

A regulation named "Accounting for Government Grants and Disclosure of Government Assistance" under International Accounting Standards.