If the Price of a Good Rises by 10% and the Percentage

question 173

Multiple Choice

If the price of a good rises by 10% and the percentage increase in the total amount consumers spend on the good is 15% then the good is

• A)elastic.
• B)inelastic.
• C)unit elastic.
• D)perfectly inelastic.

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Definitions:

Inventory Sold

The total cost of goods or merchandise a business has sold to customers during a specific period, key for calculating cost of goods sold.

Factored Receivables Financing

A financial transaction where a business sells its accounts receivable to a third party at a discount in exchange for immediate cash.

Compensating Balance

A minimum balance that must be maintained in a bank account, often required by banks as a condition for granting a loan or extending credit.

Assigned Receivables Financing

A financing method where a company uses its accounts receivable as collateral to receive a loan or advance.