The Demand for a Factor Will Be More Elastic If

question 65

Multiple Choice

The demand for a factor will be more elastic if

• A)there is little substitutability between factors.
• B)it is easier to substitute between this factor and others.
• C)that factor determines a small percentage of total cost.
• D)the demand for the good being produced is inelastic.
• E)the supply of the factor is elastic.

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Definitions:

Adjusting Entry

A journal entry made in accounting records at the end of an accounting period to allocate income and expenditure to the period in which they actually occurred.

Year 1

Refers to the first year of operation for a business or the first year of a specific reporting period.

Contra-asset

A contra-asset account is a type of asset account where its balance is a negative figure that offsets the balance of its corresponding asset account.

Liability

A financial obligation or debt owed by a company to another entity, which is expected to be settled through the transfer of assets or services.