If the Price of a Good Increases and an Individual's

question 3

Multiple Choice

If the price of a good increases and an individual's demand is elastic,identify the correct statement about total utility (TU) ,marginal utility (MU) ,consumer surplus (CS) ,and total expenditure (TE) .

• A)TU increases, MU decreases, CS decreases, and TE decreases.
• B)TU increases, MU increases, CS increases, and TE decreases.
• C)TU decreases, MU increases, CS decreases, and TE increases.
• D)TU decreases, MU decreases, CS decreases, and TE decreases.
• E)TU decreases, MU increases, CS decreases, and TE decreases.

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Definitions:

Liability Account

An accounting record that holds the amounts owed by a company to creditors, suppliers, or lenders.

Terms

Conditions under which a sale is made, including payment timeframe, discounts, and penalties for late payment.

Discount

A reduction from the usual cost of something, or the act of lowering the price of goods, services, or securities.

Day

A 24-hour period from midnight to midnight.