If the absolute price elasticity of demand for a product is less than 1, then
A. consumers are relatively sensitive to price changes.
B. consumers are relatively insensitive to price changes.
C. there is a positive relationship between price changes and total revenue.
D. producers are relatively insensitive to price changes.
Answer: B
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From the economist's point of view, dividends paid to stockholders are part of a corporation's costs
A) because taxes are paid on a corporation's profits prior to the payment of dividends. B) because they must be included in stockholders' incomes for purposes of personal income taxation. C) insofar as they are contractual obligations. D) insofar as they represent what funds invested in the corporation could have earned elsewhere.
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