The Demand for Bread Is Less Elastic Than the Demand

question 193

True/False

The demand for bread is less elastic than the demand for donuts; hence, a tax on bread will create a larger deadweight loss than will the same tax on donuts, other things equal.

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Definitions:

Need For Power

A personal drive to influence, control or have authority over others, as described in McClelland's theory of needs.

ERG Theory

A theory in psychology proposed by Clayton Alderfer that categorizes human needs into three categories: Existence, Relatedness, and Growth, and suggests that these needs can be pursued simultaneously.

Activated Need

A psychological or physiological requirement that motivates behavior towards its fulfillment.

Hygiene Factors

In the job context are sources of job dissatisfaction.