Which of the Following Generalizations Is Not Correct

question 44

Multiple Choice

Which of the following generalizations is not correct?

• A)The larger an item is in one's budget, the greater the price elasticity of demand.
• B)The price elasticity of demand is greater for necessities than it is for luxuries.
• C)The larger the number of close substitutes available, the greater will be the price elasticity of demand for a particular product.
• D)The price elasticity of demand is greater the longer the time period under consideration.

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Definitions:

Common Stock

Represents ownership shares issued by a corporation, giving holders voting rights and a residual claim on the company's assets and earnings.

Acquisition Transaction

A business event wherein one company purchases a portion or all of another company's shares or assets.

Credit Balance

A situation in an account where the sum of credits exceeds the sum of debits.

Consolidated Revenues

The total income generated by a parent company and its subsidiaries, combined into one figure, reflecting the aggregate of all operations.