The price elasticity of demand is important to firms because
a. it explains the relationship between income and demand for the goods they sell
b. it shows how price changes affect total expenditures on the goods they sell
c. the law of demand suggests that elasticity falls as total expenditures continuously rises
d. it helps identify the equilibrium price and quantity in the market
e. it relates price to supply
B
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When the government prohibits certain kinds of market behavior such as monopoly and monopolistic practices it generally does so through
A) regulatory agencies such as the Interstate Commerce Commission or the Federal Communications Commission. B) antitrust law. C) the police powers of the states. D) use of the capture theory of regulation.
Tax credits are more beneficial to taxpayers than _____
a. exemptions b. deductions c. expenditures d. a and b e. a and c