When the Percentage Change in Quantity Demanded Is Less Than

question 49

Multiple Choice

When the percentage change in quantity demanded is less than the percentage change in price:

• A) demand is price elastic.
• B) demand is price inelastic.
• C) an increase in price will result in lower total revenue.
• D) total revenue will be zero at the midpoint of a linear demand curve.

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Definitions:

Owner's Capital Account

An account on a company's balance sheet that represents the owner's investment and retained earnings in the business.

Credit Balance

This represents the amount that a company or individual owes to creditors; in accounting, it indicates a balance on the right side of a ledger.

Owner's Drawings Account

A specific account used to track the withdrawals made by the owner from the business for personal use, rephrased from

Owner's Equity

The remaining value of an entity's assets after all debts have been subtracted, indicating the stake of shareholders or owners in the company.