For Business Products, the Concept of Inelasticity of Demand Applies

question 16

True/False

For business products, the concept of inelasticity of demand applies equally to industry demand for the product and to demand for an individual supplier.

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Definitions:

Demand Curve

A graph illustrating how much of a given product a household would be willing to buy at different prices.

Perfectly Competitive

An economic model where numerous buyers and sellers exist, there's unrestricted entry and exit, and the product offered is uniform.

Market Price

The present cost at which a product or service is available for purchase or sale in the marketplace.

Profit

The financial gain obtained when the amount earned from a business activity exceeds the expenses, costs, and taxes needed to sustain the activity.