Which of the Following Is True

question 118

Multiple Choice

Which of the following is true?
i.The easier it is to find substitutes for a good,the more price elastic the demand for the good is.
ii.The demand for a good is more price elastic the smaller the proportion of income spent on it.
iii.If demand is price elastic,lowering the price leads to a decrease in total revenue.

• A) only i
• B) only ii
• C) only iii
• D) i and ii
• E) i and iii

---

Definitions:

Price Elastic

A characteristic of goods for which demand or supply changes significantly when the price changes.

Honda Accords

A series of automobiles manufactured by Honda, known for their reliability and efficiency.

Unitary

In the context of price elasticity, a situation where a change in price leads to a proportional change in quantity demanded, meaning the elasticity is equal to one.

Quantity Supplied

The volume of goods or services that manufacturers are ready and capable of selling at a certain price during a particular period.