Demand for a good is likely to be less elastic
a. the more narrowly defined the good is
b. the larger the good's share of the buyer's budget
c. in the long run than in the short run
d. the smaller the number of substitute goods available
e. at high prices
D
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Arbitrage
a. Is the act of to buying low in one market and selling high in another market b. Can force a seller to go back to uniform pricing c. Can offset the benefits of direct price discrimination d. All of the above
Assume that the required reserve ratio is 20 percent. If the Federal Reserve buys $80 million in government securities from the general public, then the money supply will immediately:
A. Increase by $0 with this transaction, and the maximum money-lending potential of the commercial banking system will increase by $400 million B. Increase by $0 with this transaction, but the maximum money-lending potential of the commercial banking system will increase by $320 million C. Increase by $80 million with this transaction, and the maximum money-lending potential of the commercial banking system will increase by another $400 million D. Increase by $80 million with this transaction, and the maximum money-lending potential of the commercial banking system will increase by another $320 million