Filters
Question type
Study Flashcards

How are the cross elasticity of demand and income elasticity of demand similar and how are they different from the price elasticity of demand?

Correct Answer

verifed

verified

The cross and income elasticities are si...

View Answer

What are the three cases for the price elasticity of demand? Briefly define each.

Correct Answer

verifed

verified

Demand can be elastic,inelastic,or unit ...

View Answer

What is the formula for the cross elasticity of demand? The percentage change in the


A) quantity demanded divided by the percentage change in the price of a substitute or complement.
B) quantity supplied divided by the percentage change in price.
C) quantity demanded divided by the percentage change in price.
D) quantity demanded divided by the percentage change in income.
E) equilibrium quantity demanded divided by the equilibrium quantity supplied.

F) A) and E)
G) B) and E)

Correct Answer

verifed

verified

The elasticity of demand is used to


A) determine if consumers will or will not buy a product.
B) measure how responsive consumers are to a change in price.
C) determine in what direction the demand curve shifts if income changes.
D) find the market equilibrium.
E) determine if a change in price results in a shortage or a surplus.

F) A) and C)
G) B) and E)

Correct Answer

verifed

verified

The price elasticity of demand is a measure of the extent to which the quantity demanded of a good changes when ________ and all other influences on buyers' plans remain the same.


A) income changes
B) the price of a related good changes
C) the price of the good changes
D) the demand alone changes
E) both the demand and the supply simultaneously change

F) B) and C)
G) A) and E)

Correct Answer

verifed

verified

A 10 percent increase in income brings about a 15 percent decrease in the demand for a good.What is the income elasticity of demand and is the good a normal good or an inferior good?

Correct Answer

verifed

verified

The income elasticit...

View Answer

What is the price elasticity of supply? List and briefly define three cases of the price elasticity of supply.

Correct Answer

verifed

verified

The price elasticity of supply measures ...

View Answer

When the price of a textbook is $95,the quantity of textbooks supplied is 90 million a year and when the price rises to $105,the quantity of textbooks supplied is 110 million a year.The supply of textbooks is


A) elastic.
B) perfectly elastic.
C) inelastic.
D) perfectly inelastic.
E) unit elastic.

F) B) and D)
G) C) and D)

Correct Answer

verifed

verified

Using the midpoint method,if the price of an airline ticket from Orlando to Pittsburgh falls from $275 to $238,the percentage change in price is


A) 1442 percent.
B) 14.42 percent.
C) 15.54 percent.
D) 13.45 percent.
E) 68.00 percent.

F) All of the above
G) A) and E)

Correct Answer

verifed

verified

When supply is perfectly inelastic,the supply curve is


A) upward sloping but not a straight line.
B) vertical.
C) downward sloping.
D) horizontal.
E) a straight line with a 45 degree slope that goes through the origin.

F) A) and B)
G) C) and D)

Correct Answer

verifed

verified

If the income elasticity of demand for a good is 2,then when income rises 10 percent,the quantity demanded


A) increases 2 percent.
B) increases 20 percent.
C) decreases 2 percent.
D) decreases 20 percent.
E) increases 12 percent.

F) A) and E)
G) A) and B)

Correct Answer

verifed

verified

The fact that there is a very limited amount of land in Hong Kong means the supply of new apartments in Hong Kong is


A) inelastic.
B) elastic.
C) unit elastic.
D) perfectly elastic.
E) limited by the demand.

F) A) and E)
G) A) and D)

Correct Answer

verifed

verified

It is very difficult for Gourmet Chocolatier to find inexpensive and available inputs for the business.Because of this,we predict that Gourmet Chocolatier's supply to be


A) inelastic.
B) perfectly elastic.
C) elastic.
D) unit elastic.
E) nonexistent.

F) A) and E)
G) D) and E)

Correct Answer

verifed

verified

The income elasticity of demand is the percentage change in the ________ divided by the percentage change in ________.


A) quantity demanded;the price of a substitute or complement
B) quantity supplied;price
C) quantity demanded;price
D) quantity demanded;income
E) quantity demanded when income changes;the quantity supplied

F) None of the above
G) B) and E)

Correct Answer

verifed

verified

Explain the total revenue test.

Correct Answer

verifed

verified

The total revenue test estimates whether...

View Answer

-June makes holiday wreaths and sells them during the holiday season.The figure above shows her supply curve of wreaths per week.Use the midpoint method in this problem. a.Calculate the percentage change in quantity between points A and B. b.Calculate the percentage change in price between points A and B. c.Calculate the price elasticity of supply between points A and B. -June makes holiday wreaths and sells them during the holiday season.The figure above shows her supply curve of wreaths per week.Use the midpoint method in this problem. a.Calculate the percentage change in quantity between points A and B. b.Calculate the percentage change in price between points A and B. c.Calculate the price elasticity of supply between points A and B.

Correct Answer

verifed

verified

a.The percentage change in qua...

View Answer

-Using the data in the table above,the demand for skirts is A) elastic. B) unit elastic. C) inelastic. D) indeterminate. E) perfectly inelastic. -Using the data in the table above,the demand for skirts is


A) elastic.
B) unit elastic.
C) inelastic.
D) indeterminate.
E) perfectly inelastic.

F) D) and E)
G) A) and B)

Correct Answer

verifed

verified

If Microsoft wanted to prove to the Justice Department that its Windows software has many substitutes that personal computer owners can use,Microsoft hopes to find


A) that the demand for Windows is inelastic.
B) that the demand for Windows is elastic.
C) a large positive value for the cross elasticity of Windows and other software.
D) a negative income elasticity for Windows.
E) a positive income elasticity for Windows.

F) A) and B)
G) A) and C)

Correct Answer

verifed

verified

Suppose the price of a box of cereal rises from $4 to $6.Using the midpoint method,what is the percentage change in price?


A) 50 percent
B) 40 percent
C) 33 percent
D) 67 percent
E) None of the above answers is correct.

F) C) and D)
G) A) and C)

Correct Answer

verifed

verified

-The figure above shows the supply curve for a good with A) a perfectly elastic supply. B) a perfectly inelastic supply. C) an elastic supply. D) an inelastic supply. E) a unit elastic supply. -The figure above shows the supply curve for a good with


A) a perfectly elastic supply.
B) a perfectly inelastic supply.
C) an elastic supply.
D) an inelastic supply.
E) a unit elastic supply.

F) B) and D)
G) C) and E)

Correct Answer

verifed

verified

Showing 321 - 340 of 342

Related Exams

Exam 1

Getting Started

347 Questions

Exam 2

The Usand Global Economies

211 Questions

Exam 3

The Economic Problem

282 Questions

Exam 4

Demand and Supply

334 Questions

Exam 6

Efficiency and Fairness of Markets

361 Questions

Exam 7

Government Actions in Markets

335 Questions

Exam 8

Global Markets in Action

281 Questions

Exam 9

Externalities: Pollution, education, and Health Care

297 Questions

Exam 10

Production and Cost

274 Questions

Exam 11

Perfect Competition

285 Questions

Exam 12

Monopoly

384 Questions

Exam 13

Monopolistic Competition and Oligopoly

313 Questions

Exam 14

Gdp: a Measure of Total Production and Income

263 Questions

Exam 15

Jobs and Unemployment

293 Questions

Exam 16

The Cpi and the Cost of Living

273 Questions

Exam 17

Potential Gdp and Economic Growth

330 Questions

Exam 18

Money and the Monetary System

370 Questions

Exam 19

Aggregate Supply and Aggregate Demand

313 Questions

Exam 20

Fiscal Policy and Monetary Policy

222 Questions

Show Answer