Which of the Following Statements About the Elasticity of Demand

question 271

Multiple Choice

Which of the following statements about the elasticity of demand for a monopolist is TRUE?

• A) Since a monopolist produces a good with no close substitutes, the price elasticity of demand for the good is zero.
• B) A monopolist produces a good with demand that is perfectly inelastic because people can not do without the good.
• C) Since every good has some substitute, even if imperfect, the demand for a good produced by a monopolist will not have zero price elasticity.
• D) Since the demand curve of a monopolist is downward sloping, the demand for the good must be inelastic.

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Definitions:

Perceptual Organization

The process by which the brain structures sensory stimuli into meaningful patterns or objects.

Vestibular Sense

The sense of equilibrium that informs us about our bodies’ positions relative to gravity.

Earth's Gravity

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Organ of Corti

The sensory organ located within the cochlea of the inner ear, responsible for converting sound vibrations into neural signals.