If, for a Given Percentage Increase in Price, Quantity Demanded

question 28

Multiple Choice

If, for a given percentage increase in price, quantity demanded falls by a proportionately smaller percentage, then demand is

• A)unit elastic.
• B)perfectly elastic.
• C)relatively inelastic.
• D)relatively elastic.

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Definitions:

Required Return

The lowest profit anticipated by an investor from a specific asset or project investment.

Profitability Index

A financial metric that calculates the relative profitability of an investment by dividing the present value of future cash flows by the initial investment cost.

Required Rate

The minimum return an investor expects to achieve by investing in a particular asset, often used in capital budgeting.

Profitability Index

A ratio that compares the present value of future cash flows generated by an investment to the investment's initial cost, indicating its relative profitability.