Jerome Says That He Will Spend Exactly $25 Each Month

question 146

Multiple Choice

Jerome says that he will spend exactly $25 each month on new apps for his mobile device,regardless of the price of apps.Jerome's demand for apps is

• A)perfectly elastic.
• B)unit elastic.
• C)perfectly inelastic.
• D)somewhat inelastic,but not perfectly inelastic.

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Definitions:

Retail Inventory Method

An accounting technique used in retail to estimate the ending inventory value based on the relationship between the cost and selling price of goods.

Cost-to-retail Ratio

A method used in inventory accounting that estimates the value of ending inventory by calculating the cost to retail price ratio.

Homogeneous Inventory

An inventory system where all items are similar in nature and use, making management and valuation processes more straightforward.

Markup

The difference between the cost of a good or service and its selling price, expressed as a percentage over the cost.