Scenario 5-3 Suppose That the Supply of Aged Cheddar Cheese Is Inelastic,and

question 2

Multiple Choice

Scenario 5-3
Suppose that the supply of aged cheddar cheese is inelastic,and the supply of bread is elastic.Both goods are considered to be normal goods by a majority of consumers.Suppose that a large income tax increase decreases the demand for both goods by 10%.
-Refer to Scenario 5-3.The price elasticity of supply for bread could be

• A)-1.
• B)0.
• C)0.5.
• D)1.5.

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Definitions:

Overpopulation

A condition where an environment's population exceeds the capacity it has to support life healthily and comfortably.

Income Gap

The disparity in income and wealth distribution between different groups in society, often measured between the rich and the poor.

Provide Services

The act of performing tasks or duties for customers or clients.