Question 1

In the figure above,what is the point price elasticity of demand when price is $60?

Accepted Answer

A) -0.50 
B) -0.75 
C) -1.00 
D) -1.60 
E) -2.00 
A) -0.50 
B) -0.75 
C) -1.00 
D) -1.60 
E) -2.00

Question 2

Use the figure to calculate the income elasticity of demand when income increases from $25,000 to $30,000:

Accepted Answer

A) -1.0 
B) -0.1818 
C) 0.1818 
D) -1.5 
E) 1.2 
A) -1.0 
B) -0.1818 
C) 0.1818 
D) -1.5 
E) 1.2

Question 3

the figure below,which shows a linear demand curve and the associated total revenue curve,to answer the question.   The marginal revenue of the 700th unit is $_____ and demand is __________ at this point.

Accepted Answer

A) -20; elastic 
B) -20; inelastic 
C) 15; elastic 
D) 15; inelastic 
A) -20; elastic 
B) -20; inelastic 
C) 15; elastic 
D) 15; inelastic

Question 4

If the quantity of gidgets demanded increases when the price of gadgets decreases

Accepted Answer

A) gidgets and gadgets are substitutes. 
B) gidgets and gadgets are complements. 
C) gidgets are normal goods,while gadgets are inferior goods. 
D) gadgets are normal goods,while gidgets are inferior goods. 
A) gidgets and gadgets are substitutes. 
B) gidgets and gadgets are complements. 
C) gidgets are normal goods,while gadgets are inferior goods. 
D) gadgets are normal goods,while gidgets are inferior goods.

Question 5

To answer the question,refer to the following table showing a demand schedule: $\begin{array}{llcc}
\underline{  \text {Price  } }&\underline{ \text { Ouantity } } \
 &\underline{\text {demanded  }} \
\$200 &1000\
150&1400\
100 &1800\
\end{array}$  As quantity demanded rises from 1,400 to 1,800,what is marginal revenue?

Accepted Answer

A) $25 
B) $50 
C) -$400 
D) -$50 
E) -$75 
A) $25 
B) $50 
C) -$400 
D) -$50 
E) -$75

Question 6

If the demand for plastic surgery is price inelastic,

Accepted Answer

A) changes in price do not affect the number of operations. 
B) then when more plastic surgery is performed,total expenditures on plastic surgery will decrease. 
C) the percentage change in price is less than the percentage change in quantity. 
D) both b and c 
E) both a and b 
A) changes in price do not affect the number of operations. 
B) then when more plastic surgery is performed,total expenditures on plastic surgery will decrease. 
C) the percentage change in price is less than the percentage change in quantity. 
D) both b and c 
E) both a and b

Question 7

Which of the following will NOT affect the elasticity of demand for a product?

Accepted Answer

A) the number of substitutes 
B) how long consumers have to adapt to price changes 
C) the cost of producing the product 
D) the percentage of the consumer's budget spent on the product 
E) all of the above will affect the elasticity of demand for a product 
A) the number of substitutes 
B) how long consumers have to adapt to price changes 
C) the cost of producing the product 
D) the percentage of the consumer's budget spent on the product 
E) all of the above will affect the elasticity of demand for a product

Question 8

Which of the following would tend to DECREASE the elasticity of demand for good X?

Accepted Answer

A) The cost of producing X decreases. 
B) Several firms which used to produce substitutes for X go out of business. 
C) Consumers begin spending a smaller percentage of their income on X. 
D) both b and c 
E) all of the above 
A) The cost of producing X decreases. 
B) Several firms which used to produce substitutes for X go out of business. 
C) Consumers begin spending a smaller percentage of their income on X. 
D) both b and c 
E) all of the above

Question 9

In the figure above,what is the interval elasticity of demand over the price range $60 to $80?

Accepted Answer

A) -0.75 
B) -1.10 
C) -1.00 
D) -1.40 
E) -2.00 
A) -0.75 
B) -1.10 
C) -1.00 
D) -1.40 
E) -2.00

Question 10

If the quantity of Harley-Davidson motorcycles demanded decreases by 10% when the price increases by 20%,the price elasticity of demand for Harley-Davidson motorcycles is:

Accepted Answer

A) -0.50 
B) -2.0 
C) -10.0 
D) -20.0 
A) -0.50 
B) -2.0 
C) -10.0 
D) -20.0

Question 11

If the price elasticity of demand for Harley-Davidson motorcycles is -1.2 and quantity demanded increases by 24%,price must have

Accepted Answer

A) decreased by 20%. 
B) increased by 20%. 
C) decreased by 28.8%. 
D) decreased by 0.05%. 
A) decreased by 20%. 
B) increased by 20%. 
C) decreased by 28.8%. 
D) decreased by 0.05%.

Question 12

According to the following figure,the equation for demand is

Accepted Answer

A) P = 4,000 - 50Q. 
B) P = 4,000 - 80Q. 
C) Q = 4,000 - 50P. 
D) Q = 50 - 80P. 
E) none of the above 
A) P = 4,000 - 50Q. 
B) P = 4,000 - 80Q. 
C) Q = 4,000 - 50P. 
D) Q = 50 - 80P. 
E) none of the above

Question 13

Demand is (more elastic / less elastic)in the short run than in the long run

Accepted Answer

A) (more elastic)because goods account for a larger percentage of the consumer's budget in the short run than in the long run. 
B) (less elastic)because goods account for a smaller percentage of the consumer's budget in the short run than in the long run. 
C) (more elastic)because consumers have less time to adapt to a price change in the short run than in the long run. 
D) (less elastic)because consumers have less time to adapt to a price change in the short run than in the long run. 
A) (more elastic)because goods account for a larger percentage of the consumer's budget in the short run than in the long run. 
B) (less elastic)because goods account for a smaller percentage of the consumer's budget in the short run than in the long run. 
C) (more elastic)because consumers have less time to adapt to a price change in the short run than in the long run. 
D) (less elastic)because consumers have less time to adapt to a price change in the short run than in the long run.

Question 14

the figure below,which shows a linear demand curve and the associated total revenue curve,to answer the question.   The price at which total revenue is maximized is $_____.

Accepted Answer

A) 10 
B) 15 
C) 20 
D) 25 
E) 30 
A) 10 
B) 15 
C) 20 
D) 25 
E) 30

Question 15

In the figure above,if price DECREASES from $80 to $60,an arrow representing the QUANTITY effect

Accepted Answer

A) will point upward. 
B) will point downward. 
C) will be shorter than (and in the opposite direction of)the arrow representing the price effect. 
D) will be shorter than (and in the same direction of)the arrow representing the price effect. 
E) will point in the opposite direction in which total revenue will move. 
A) will point upward. 
B) will point downward. 
C) will be shorter than (and in the opposite direction of)the arrow representing the price effect. 
D) will be shorter than (and in the same direction of)the arrow representing the price effect. 
E) will point in the opposite direction in which total revenue will move.

Question 16

When the price of corn dogs is $0.50,10,000 corn dogs are demanded.When the price of corn dogs is $1.20,5,000 are demanded.What is the price elasticity of demand for corn dogs?

Accepted Answer

A) -0.40 
B) -0.81 
C) -1.20 
D) -1.40 
A) -0.40 
B) -0.81 
C) -1.20 
D) -1.40

In the figure above,what is the point price elasticity of demand when price is $60?

Use the figure to calculate the income elasticity of demand when income increases from $25,000 to $30,000:

the figure below,which shows a linear demand curve and the associated total revenue curve,to answer the question. The marginal revenue of the 700th unit is $_ and demand is ______ at this point.

If the quantity of gidgets demanded increases when the price of gadgets decreases

To answer the question,refer to the following table showing a demand schedule: \2 00 1000 150 1400 100 1800 As quantity demanded rises from 1,400 to 1,800,what is marginal revenue?

If the demand for plastic surgery is price inelastic,

Which of the following will NOT affect the elasticity of demand for a product?

Which of the following would tend to DECREASE the elasticity of demand for good X?

In the figure above,what is the interval elasticity of demand over the price range $60 to $80?

If the quantity of Harley-Davidson motorcycles demanded decreases by 10% when the price increases by 20%,the price elasticity of demand for Harley-Davidson motorcycles is:

If the price elasticity of demand for Harley-Davidson motorcycles is -1.2 and quantity demanded increases by 24%,price must have

According to the following figure,the equation for demand is

Demand is (more elastic / less elastic)in the short run than in the long run

the figure below,which shows a linear demand curve and the associated total revenue curve,to answer the question. The price at which total revenue is maximized is $_____.

In the figure above,if price DECREASES from $80 to $60,an arrow representing the QUANTITY effect

When the price of corn dogs is $0.50,10,000 corn dogs are demanded.When the price of corn dogs is $1.20,5,000 are demanded.What is the price elasticity of demand for corn dogs?

Managers,profits,and Markets

Demand,supply,and Market Equilibrium

Marginal Analysis for Optimal Decisions

Basic Estimation Techniques

Theory of Consumer Behavior

Demand Estimation and Forecasting

Production and Cost in the Short Run

Production and Cost in the Long Run

Production and Cost Estimation

Managerial Decisions in Competitive Markets

Managerial Decisions for Firms With Market Power

Strategic Decision Making in Oligopoly Markets

Advanced Pricing Techniques

Decisions Under Risk and Uncertainty

Government Regulation of Business

Filters

Exam 6: Elasticity and Demand

In the figure above,what is the point price elasticity of demand when price is $60?

Use the figure to calculate the income elasticity of demand when income increases from $25,000 to $30,000:

the figure below,which shows a linear demand curve and the associated total revenue curve,to answer the question. The marginal revenue of the 700th unit is $_____ and demand is __________ at this point.

If the quantity of gidgets demanded increases when the price of gadgets decreases

To answer the question,refer to the following table showing a demand schedule: \2 00 1000 150 1400 100 1800 As quantity demanded rises from 1,400 to 1,800,what is marginal revenue?

If the demand for plastic surgery is price inelastic,

Which of the following will NOT affect the elasticity of demand for a product?

Which of the following would tend to DECREASE the elasticity of demand for good X?

In the figure above,what is the interval elasticity of demand over the price range $60 to $80?

If the quantity of Harley-Davidson motorcycles demanded decreases by 10% when the price increases by 20%,the price elasticity of demand for Harley-Davidson motorcycles is:

If the price elasticity of demand for Harley-Davidson motorcycles is -1.2 and quantity demanded increases by 24%,price must have

According to the following figure,the equation for demand is

Demand is (more elastic / less elastic)in the short run than in the long run

the figure below,which shows a linear demand curve and the associated total revenue curve,to answer the question. The price at which total revenue is maximized is $_____.

In the figure above,if price DECREASES from $80 to $60,an arrow representing the QUANTITY effect

When the price of corn dogs is $0.50,10,000 corn dogs are demanded.When the price of corn dogs is $1.20,5,000 are demanded.What is the price elasticity of demand for corn dogs?

Managers,profits,and Markets

Demand,supply,and Market Equilibrium

Marginal Analysis for Optimal Decisions

Basic Estimation Techniques

Theory of Consumer Behavior

Demand Estimation and Forecasting

Production and Cost in the Short Run

Production and Cost in the Long Run

Production and Cost Estimation

Managerial Decisions in Competitive Markets

Managerial Decisions for Firms With Market Power

Strategic Decision Making in Oligopoly Markets

Advanced Pricing Techniques

Decisions Under Risk and Uncertainty

Government Regulation of Business

Filters

the figure below,which shows a linear demand curve and the associated total revenue curve,to answer the question. The marginal revenue of the 700th unit is $_ and demand is ______ at this point.