In General, a "Big Ticket Item" Such as a House

question 128

Multiple Choice

In general, a "big ticket item" such as a house or new car will

• A)tend to have a more elastic demand than a lower-priced good.
• B)tend to have an inelastic demand because spending on the item takes up a large share of the average consumer's budget.
• C)tend to have an inelastic demand because it has many substitutes.
• D)tend to have a more inelastic demand the more time that passes.

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Definitions:

Corporate Earnings

The profit a company generates during a specific period after accounting for all expenses, taxes, and costs, which can influence its stock price.

Dividend Announcement

A public statement by a company indicating its intention to distribute earnings to shareholders in the form of dividends.

Reversal Effect

A phenomenon in finance where the performance of stocks or markets reverses direction after a period of significant movement.

Market Trading Data

Information and statistics related to the trading activity in financial markets, including volume, price, and movements of securities.