Which of the Following Statements Is Correct

question 197

Multiple Choice

Which of the following statements is correct?

• A)The demand for natural gas is more elastic over a short period of time than over a long period of time.
• B)The demand for smoke alarms is more elastic than the demand for Persian rugs.
• C)The demand for bourbon whiskey is more elastic than the demand for alcoholic beverages in general.
• D)All of the above are correct.

---

Definitions:

Inflation Rate

The rise in the cost of goods and services across an economy over a specific period, expressed as a percentage.

Potential GDP

An estimate of the maximum level of economic activity that an economy can sustain over the long term without increasing inflation.

Labor Force

Comprises all the working-age population that is employed and those unemployed but seeking employment.

Rational Expectations

The economic theory that assumes individuals make predictions about the future based on all available information and in a way that is systematically correct.