Suppose the Price Elasticity of Demand for Oranges Is -1

question 219

Multiple Choice

Suppose the price elasticity of demand for oranges is -1.8.If a fall frost destroys one-third of the nation's orange crop, how will that affect total expenditures on oranges, all other things unchanged?

• A) total expenditures will rise
• B) total expenditures will fall
• C) total expenditures will remain unchanged
• D) not enough information is given to answer the question

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Definitions:

Cash from Sale

The cash received from selling goods or services.

Cash Receipts Journal

A financial journal that records all cash transactions, including sales and received payments, entering a business.

Accounts Payable

Obligations of a company indicating funds due to lenders for products and services acquired through credit.

Sales Revenue

Revenue generated through the sale of products or offerings during a specific timeframe.