Which of the Following Is Likely to Have the Most

question 100

Multiple Choice

Which of the following is likely to have the most price inelastic demand?

• A)strawberry-banana milk shakes
• B)gasoline in the short run
• C)diamond earrings
• D)box seats at a major league baseball game

Analyze the impact of investments on the reduction of production costs and its effect on economic profits.

Distinguish between accounting and economic profits.

Identify and explain the concept of opportunity cost in decision-making.

Differentiate between sunk costs and relevant costs for decision-making.

---

Definitions:

Ideal Standards

Benchmarks for performance or production that assume perfect efficiency and effectiveness, often used for planning purposes.

Favorable Variances

Differences between expected and actual financial performance that result in better-than-expected profitability or cost savings.

Standard Costs

Represents the expected cost of producing or purchasing items, used for budgeting and cost control purposes.

General Ledger

A ledger that contains all asset, liability, and owner’s equity accounts.