Which of the following will NOT affect the elasticity of demand for a product?
A. the cost of producing the product
B. the number of substitutes
C. the percentage of the consumer's budget spent on the product
D. how long consumers have to adapt to price changes
E. all of the above will affect the elasticity of demand for a product
Answer: A
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According to this Application, if the volatility of energy prices led to expectations of declining real GDP, investment spending at that time would tend to decrease
This relationship between the decrease in investment spending and the expected decline in real GDP would be expressed by the A) present value theory. B) liquidity principle. C) accelerator theory. D) real-nominal principle.
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A) the lemon problem. B) a manufacturer's warranty. C) a market failure. D) none of the above