A Manufacturer of Frozen Pizzas Found That Total Revenue Decreased

question 44

Multiple Choice

A manufacturer of frozen pizzas found that total revenue decreased when price was lowered from $5 to $4.It was also found that total revenue decreased when price was raised from $5 to $6.It can be concluded that:

• A)the demand for pizza is elastic above $5 and inelastic below $5
• B)the demand for pizza is elastic both above and below $5
• C)the demand for pizza is inelastic above $5 and elastic below $5
• D)the demand for pizza is inelastic both above and below $5
• E)$5 is not the equilibrium price of pizza

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Definitions:

Dividends

Payments made by a corporation to its shareholder members from the profits or reserves available for distribution, reflecting a share in the company's earnings.

Profit/(Loss)

The financial result of business operations, calculated as revenues minus expenses. A positive figure indicates profit, while a negative figure indicates loss.

General Reserve

Funds set aside out of profits by a company to strengthen the financial position and to meet future unknown liabilities or losses.

NCI Journal

Journal entries related to Non-Controlling Interest, representing the equity in a subsidiary not attributable to the parent company.