Suppose Computer Prices at an Office Supply Store Fall from $1,000

question 134

Multiple Choice

Suppose computer prices at an office supply store fall from $1,000 to $900 and as a result the quantity demanded of typewriters decreases from 40 to 20 per month.The cross-price elasticity of demand is closest to

• A)0.16.
• B)0.2.
• C)5.0.
• D)6.3.

---

Definitions:

Stockholders

Individuals or entities that own shares of stock in a corporation, making them partial owners of the company.

Marginal Efficiency

The rate of return on an investment that is additional or marginal to the current level of investment.

Capital

Assets or resources, such as machinery, buildings, or money, that can be used to produce goods and services and generate wealth.

Coined

Refers to the creation of a new word or phrase or the process of making coins as a form of currency.