If a Price Increase from $20 to $40 Causes Quantity

question 95

Multiple Choice

If a price increase from $20 to $40 causes quantity demanded to decrease from 100 units to 50 units,one can conclude that demand for the product is _____.

• A)inelastic
• B)elastic
• C)perfectly inelastic
• D)infinitely elastic
• E)unit-elastic

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Definitions:

SUTA Tax

A state unemployment tax assessed by individual states on employers, used to fund their unemployment insurance and job service programs.

Medicare

A federal health insurance program in the United States primarily for people aged 65 and older, as well as for some younger individuals with disabilities.

Unemployment Taxes

Taxes imposed on employers based on the employment and wages of employees, used to fund unemployment insurance benefits.

FICA Tax

Federal Insurance Contributions Act tax, which is a United States federal payroll tax imposed on both employees and employers to fund Social Security and Medicare.