The response of quantity demanded to price changes is shown by:
A. Price elasticity of demand.
B. The determinants of demand.
C. Opportunity cost.
D. Income elasticity of demand.
Answer: A. Price elasticity of demand.
You might also like to view...
Assume that firms in a perfectly competitive market are earning economic profits. Which of the following statements describes the change in market price and output as a result of the entry of new firms into this market?
A) The short-run market supply curve shifts to the right, causing price to fall and total market output to increase. B) The short-run market supply curve shifts to the left, causing price to rise and total market output to decrease. C) The market demand curve shifts to the left, causing price to fall and market output to decrease. D) The market demand curve shifts to the right, causing price to rise and market output to increase.
If, for the last bushel of apples produced and sold by an apple farm, marginal revenue exceeds marginal cost, then in producing that bushel the farm
A) added more to total cost than it added to total revenue. B) added an equal amount to both total revenue and total cost. C) added more to total revenue than it added to total cost. D) maximized its profits or minimized its losses.