Advertisers try to ________ the demand for their products, but at the same time try to make that demand ________.
Fill in the blank(s) with the appropriate word(s).
increase; more inelastic
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Elasticity of demand is closely related to the slope of the demand curve. The more responsive buyers are to a change in price, the
a. steeper the demand curve will be. b. flatter the demand curve will be. c. further to the right the demand curve will sit. d. closer to the vertical axis the demand curve will sit.
A consumer has two basic choices in making a trip: rent a car for $30.00 a day and spend two days of travel to the destination, or spend $400 for an airplane ticket and fly to the destination in two hours. The marginal utilities of the car rental and the airline ticket are the same. The consumer values time at $5 an hour. The rational consumer will most likely:
A. Rent a car B. Buy an airline ticket C. Find the full cost of the two modes to be equal D. Not make the trip