Demand sensitivity depends on all of the following except:
a. how low is the price of the good.
b. the sensitivity of firms' output to changes in its price.
c. the consumer's income.
d. the availability and closeness of substitutes.
e. the amount of time a consumer has to adjust to price changes.
b
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Positive economics answers the question, "What ought to be?" Normative economics predicts the consequences of alternative actions, answering the questions, "What is?" or "What will be?"
Indicate whether the statement is true or false
An increase in the value of the U.S. dollar will
A) increase Canadian demand for winter homes in Florida. B) increase the cost of homes in Florida for American buyers. C) reduce Canadian demand for winter homes in Florida. D) reduce the cost of homes in Florida for Canadian buyers.