A Perfectly Elastic Demand

question 19

Multiple Choice

A perfectly elastic demand:

• A) means consumers are extremely sensitive to a change in price.
• B) means quantity demanded is unchanged if the price changes by any amount.
• C) is demonstrated by a vertical demand curve.
• D) has a price elasticity of 1.

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Definitions:

Retained Earnings

Retained earnings are the portion of a company’s profits that is kept or retained rather than being paid out as dividends to shareholders or reinvested into the business.

Closing Entries

Entries recorded at the conclusion of an accounting cycle to shift balances from temporary to permanent accounts.

Charters

Legal documents that establish a corporation or other organization, setting forth the name, purpose, regulations, and structure of the entity.

State Laws

The legal guidelines and regulations enacted by individual states in the United States, varying significantly from one state to another.