Geoff Strolled into His Local Big Box Retailer in Search

question 2

Multiple Choice

Geoff strolled into his local big box retailer in search of sunflower seeds for the flock of cardinals that graced his property during the cold winter.Much to his (and the cardinals') dismay,the shelf where the 50 pound bags of sunflower seeds were kept was bare.He pirouetted and left the store in disgust,empty-handed and fearing the wrath of an angry flock of cardinals when he returned home.This sad scenario illustrates

• A)safety inventory.
• B)cycle inventory.
• C)a markdown.
• D)a lost sale.

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Definitions:

Price Elasticity

The extent to which changes in price affect the demand for a specific good.

Completely Inelastic

A situation where the quantity demanded or supplied does not change regardless of changes in price.

Infinitely Elastic

Describes a market situation in which the quantity demanded or supplied changes by an unlimited amount in response to any change in price, indicative of perfect competition.

Elastic

A term used in economics to describe a situation in which the supply or demand for a good or service is sensitive to changes in price.