Which Would Result in a Decrease in the Elasticity of Demand

question 80

Multiple Choice

Which would result in a decrease in the elasticity of demand for a particular resource?

• A) A decrease in the rate at which the marginal product of that resource declines.
• B) An increase in the elasticity of demand for the product that the resource helps to produce.
• C) A decrease in the percentage of the firm's total costs accounted for by the resource.
• D) An increase in the substitutability of other resources for the particular resource.

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Definitions:

Sold

The past tense indicating that an item, property, or service has been transferred to a buyer in exchange for money or other compensation.

Journal Entry

A record in accounting that represents a transaction where debits and credits are entered, reflecting changes in accounts.

Straight-Line Method

A method of calculating depreciation by evenly allocating the cost of an asset over its useful life.

Semiannual Amortization

The process of periodically reducing the value of a debt or an intangible asset over two times in a year.