In the context of elasticity of demand, which of the following goods is likely to have inelastic demand? MCQ with Answer and Explanation

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In the context of elasticity of demand, which of the following goods is likely to have inelastic demand?

A. Jewellery

B. Luxury cars

C. Air conditioners

D. Salt

Answer: Option D

Solution (By JKSSB Mock Tests)

Necessities like salt have inelastic demand because quantity demanded does not change significantly with price changes. Luxuries tend to have elastic demand.

This question belongs to: Economy GK Economy Set 1

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Question #1

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The term 'Invisible Trade' in the balance of payments refers to:

A. Trade in goods only

B. Trade in services, income and transfers

C. Only foreign direct investment

D. Only capital transfers

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Correct Answer: Option B

Explanation:
Invisible trade (or invisibles) includes trade in services (such as tourism, software, transportation), income (interest, dividends) and unilateral transfers.

This question belongs to: Economy GK Economy Set 1