Exam 4: Elasticity

Use the accompanying graph to answer the following questions. a.A study shows the many health benefits of eating eggs for breakfast.Demand rises by 6 units at each price.Draw this on the graph. b.What is the percentage change in equilibrium price for eggs? c.If the percentage change in quantity demanded for toast decreased by 1/2 of what you found in part (b)for eggs,what is the cross-price elasticity of demand for eggs and toast? d.Will this be positive or negative? Are eggs and toast related to each other?

A local sandwich shop can quickly place an order for food with its local vendors if it uses up its existing resources quickly.This indicates that the price elasticity of supply is:

In the accompanying table,assume that the price of ice skates increases from $10 to $20 per pair.Using the midpoint method,calculate the price elasticity of demand for ice skates for hockey players.

If your friend says,"I am never going to buy another Avicii remix again!" his price elasticity of demand for Avicii remixes is:

The Sunny Softball league found that,when it changed its ticket prices from $10 to $5,there was a more than proportional but not infinite increase in attendance.The price elasticity of demand is:

Firms supplying twisty-ties decrease the quantity supplied of inputs by 10% when the price decreases by 5%.The price elasticity of supply for twisty-ties is:

Assume that the demand for Choco Candy Bites is price elastic. a.Draw a demand curve for Choco Candy Bites.Label each axis and curve. b.Use the relatively price elastic demand curve from (a)and draw the entire market graph for Choco Candy Bites.Label the equilibrium price P₁ and the equilibrium quantity Q₁.If the supply curve for Choco Bites shifts to the left,will there be a relatively large or small change in P and Q? Indicate this on your graph.Label the new equilibrium price P₂ and the equilibrium quantity Q₂. c.Compare this change in P and Q to the changes that would result with a relatively price inelastic demand curve. d.What impact does the price elasticity of demand have on the change in P and Q?

When her income falls from $50,000 to $20,000,Alex increases her monthly purchase of hamburger from 20 pounds to 35 pounds.From the midpoint method,Alex's income elasticity of demand for hamburgers is:

At a price of $2,the quantity demanded for pens is 12.When the price increases to $3,the quantity demanded for pens is 10.The price elasticity of demand for pens is:

Your local bakery gives you information on consumer purchasing habits for muffins and cupcakes.It tells you that,when the price of a muffin is $1,people buy 55 cupcakes.When the price of a muffin is raised to $2,cupcake purchases go up to 65 cupcakes.The cross-price elasticity of demand is:

When incomes fall by 20%,quantity demanded of specialty baked goods falls by 50%.Specialty baked goods are:

A 15% increase in the price of cookies results in a 9% decrease in the quantity of cookies sold.The revenue received by cookie suppliers will ________ because the price elasticity of demand for cookies is ________.