A Perfectly Elastic Demand Is One in Which The

question 99

Multiple Choice

A perfectly elastic demand is one in which the:

• A) demand curve is perfectly vertical.
• B) demand curve is perfectly horizontal.
• C) price elasticity is exactly 1.
• D) response to a change in price is immediate.

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Definitions:

Income Subsidies

Income subsidies are financial assistance programs provided by governments to individuals or households to help them afford essential needs, thereby increasing their income.

Economic Inefficiency

A situation where resources are not allocated optimally, leading to wastage or less than maximal output in an economy.

Food, Conservation, and Energy Act

U.S. legislation enacted in 2008 aimed at governing a wide range of agricultural and food policies, including crop insurance and nutritional programs.

Target Price

A pre-set price determined by a company or government at which a product, especially in agriculture, is aimed to be sold in the market.