What Does the Following Statement Imply About Price Elasticity of Demand

question 119

Multiple Choice

What does the following statement imply about price elasticity of demand? "Consumers unfazed by 400 percent increase in price of table salt - grocers see no change in sales!"

• A)elasticity of demand for salt is equal to one
• B)demand for salt is elastic
• C)salt is too narrowly defined to determine price elasticity of demand
• D)demand for salt is almost perfectly inelastic in the relevant price range
• E)salt is too broadly defined to determine price elasticity of demand

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Definitions:

General Partner

A member of a partnership who has full liability for the debts of the partnership and participates in its management.

Limited Partnership

A partnership structure where at least one partner has limited liability for the debts and obligations of the business, while at least one other bears unlimited liability.

LLC

A Limited Liability Company; a hybrid business structure that combines the personal asset protection of a corporation with the tax benefits of a partnership.

Distributions

The payment of assets from a fund or account to its shareholders or partners, such as dividends from a corporation or distributions from a partnership or LLC.