You Are the Manager of a Supermarket,and You Know That

question 43

Multiple Choice

You are the manager of a supermarket,and you know that the income elasticity of peanut butter is exactly −0.7.Due to the economic recession,you expect incomes to drop by 15 percent next year.How should you adjust your purchase of peanut butter?

• A) Buy 10.5 percent more peanut butter.
• B) Buy 2.14 percent more peanut butter.
• C) Buy 6.2 percent less peanut butter.
• D) Buy 9.8 percent less peanut butter.

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Definitions:

Public Goods

Goods that are non-excludable and non-rivalrous, meaning they can be consumed by many people at once without depleting the supply.

Paired-Choice Voting

A voting system in which voters choose between pairs of candidates or options in a series of rounds to identify a preferred option or candidate.

Society's Preferences

The collective desires, priorities, and tastes of a community or society, influencing consumption and production.

Paradox of Voting

A situation in which the cost of voting (time, effort) appears to outweigh the individual benefits, making it rational for people not to vote, yet people still vote.