Which of the following would tend to DECREASE the elasticity of demand for good X?
A. The cost of producing X decreases.
B. Several firms which used to produce substitutes for X go out of business.
C. Consumers begin spending a smaller percentage of their income on X.
D. both b and c
E. all of the above
Answer: D
Economics
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A) increase production to an inefficient level. B) inflate the costs of production. C) incur an economic loss. D) understate the costs of production. E) overstate their total revenue.
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Managers can increase firm profits by:
A) increasing revenue only. B) decreasing costs only. C) increasing revenue and decreasing costs. D) none of the above.
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