A Demand Relationship in Which the Quantity Demanded Changes Exactly

question 199

Multiple Choice

A demand relationship in which the quantity demanded changes exactly in proportion to the change in price is

• A) elastic.
• B) unit-elastic.
• C) inelastic.
• D) consistent with zero elasticity.

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Definitions:

Sunk Costs

Costs that have already been incurred and cannot be recovered, which should not influence future business or personal decisions.

Escalated Commitment

A pattern of behavior in which an individual or group continues to rationalize their decisions, invest additional resources, and follow a failing course of action.

Risky Shift

The tendency for groups to make riskier decisions than the average risk initially advocated by their individual members.

Faulty Hindsight

The misinterpretation or incorrect analysis of past events, often seeing them as more predictable than they actually were.