The price elasticity of demand is a measure of
A) the responsiveness of the quantity demanded of a good to a changes in the price of the good.
B) the quantity demanded of a good at a given price.
C) the demand for a product holding prices constant.
D) the horizontal shift in the demand curve when the price of a good changes.
Answer: A
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In 2002 - 2003, some McDonalds' franchise owners reported that profits were declining from selling the discounted items from the Dollar Menu. This suggests that:
A) those items are price elastic. B) those items are price inelastic. C) those items are price unitary elastic. D) none of the above.
The GDP deflator for years subsequent to the base year measures the change in
a. nominal GDP from the base year that cannot be attributable to a change in real GDP. b. real GDP from the base year that cannot be attributable to a change in nominal GDP. c. nominal GDP from the base year that cannot be attributable to a change in prices. d. real GDP from the base year that cannot be attributable to a change in prices.