Exam 20: Elasticity

Suppose a producer decides that if the price of her product is $32,the quantity supplied will be 1,000 units,and if the price is $35,the quantity supplied will be 1,300.The price elasticity of supply for the good is approximately

Which of the following statements is false?

If total revenue rises as a result of a decrease in price,it follows that demand is

The quantity supplied of land is constant regardless of price.Suppose a tax is imposed on the rental price of land.Who will pay the greater share of such a tax?

The longer the period of time allowed for the ___________ of a good to adjust to a change in the price of the good,the ___________ the price elasticity of supply will be. This statement assumes that the quantity supplied __________ be altered with time.

Exhibit 20-2 -Refer to Exhibit 20-2.The market for good X is initially in equilibrium at $5.The government then places a tax on the producers of good X-in effect,taxing them on each unit of good X they sell.As a result,the supply curve

Cross elasticity of demand measures the responsiveness of the

Suppose someone believes that if a per-unit tax is placed on the producers of good Y,the consumers of good Y will end up paying the full tax.This person assumes that the demand curve for good Y is

If price elasticity of demand is 0.5,it follows that a _______ percent decrease in price would cause a _______ percent increase in quantity demanded.

The quantity demanded of good A rises as income rises.It follows that income elasticity of demand is __________than 0,and good A is a(n)__________ good.

If the price of good X rises and the demand for good X is elastic,then the percentage __________ in quantity demanded is __________ the percentage rise in price,and total revenue __________.

Price elasticity of supply is the percentage change in the quantity __________ of a good divided by the percentage change in __________.

If total revenue does not change as a result of a rise in price,it follows that demand is

If tobacco is a normal,income inelastic good,it follows that a 10 percent decrease in income will __________ quantity demanded by __________ than 10 percent.

A good is unit elastic in demand if as the price changes there is no resulting change in total revenue.

Describe what cross elasticity of demand measures.Be specific in your response.

Exhibit 20-5 -Refer to Exhibit 20-5.For graph (3),if the seller of X raises the price from $1.50 to $2.00,the total revenue the seller receives will

If Cassandra bought 16 cotton blouses last year when her income was $40,000 and she buys 14 cotton blouses this year her when income is $35,000,then blouses are

Exhibit 20-7 -Refer to Exhibit 20-7.As a producer,if you had a choice,which of the depicted markets would you operate in?

Which of the following would result in higher price elasticity of good X?