The Price Elasticity of Demand Measures

question 105

Multiple Choice

The price elasticity of demand measures

• A)a buyer's responsiveness to a change in income.
• B)a buyer's responsiveness to a change in price.
• C)a seller's responsiveness to a change in demand.
• D)how much price increases for a change in demand.
• E)how much demand changes for a change in supply.

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Definitions:

Unemployment Rates

The fraction representing individuals in the labor force who do not have employment but are actively job hunting.

Unemployment Insurance

A government program that provides temporary financial assistance to workers who have lost their jobs through no fault of their own.

Minimum-Wage Law

Legislation that establishes the lowest hourly wage that employers can legally pay their workers.

Equilibrium Wage

The wage rate at which the quantity of labor demanded by employers equals the quantity of labor supplied by workers.