Suppose That the Price of a Product Decreased from $6

question 128

Multiple Choice

Suppose that the price of a product decreased from $6.50 to $5.50,and the quantity demanded increased from 55 to 65.What is the value of the price elasticity of demand?

• A)0.5.
• B)0.85.
• C)1.0.
• D)1.18.
• E)2.0.

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Definitions:

Interest-Burden Ratio

A financial ratio indicating the proportion of profits remaining after paying interest expenses, used to measure a company's ability to manage its interest obligations.

Profit Margin

A financial ratio indicating the percentage of revenue that exceeds the cost of goods sold, representing the proportion of each dollar of revenue that constitutes net profit.

ROA

Return on Assets, a financial ratio indicating how profitable a company is relative to its total assets.

IFRS

International Financial Reporting Standards, a set of accounting standards developed by the International Accounting Standards Board (IASB) that companies use for financial reporting.