Question 1

If the total expenditure on perfume increases when the price of perfume falls,the price elasticity of demand is

Accepted Answer

A) unity (demand is unit elastic). 
B) not determinable from the information given. 
C) exactly zero. 
D) less than one (demand is inelastic). 
E) greater than one (demand is elastic). 
A) unity (demand is unit elastic). 
B) not determinable from the information given. 
C) exactly zero. 
D) less than one (demand is inelastic). 
E) greater than one (demand is elastic).

Question 2

Which of the following statements would you expect to be true about the demand elasticities for cornflakes and food?

Accepted Answer

A) Food has a higher price elasticity of demand because it is a necessity. 
B) Because cornflakes is food,cornflakes would have the same price elasticity of demand as food. 
C) Compared with food,cornflakes have a lower price elasticity of demand because it is specifically defined. 
D) Food has a lower price elasticity of demand than cornflakes because it is more broadly defined. 
E) Because cornflakes is food,but not all food is cornflakes,cornflakes would have a lower price elasticity of demand. 
A) Food has a higher price elasticity of demand because it is a necessity. 
B) Because cornflakes is food,cornflakes would have the same price elasticity of demand as food. 
C) Compared with food,cornflakes have a lower price elasticity of demand because it is specifically defined. 
D) Food has a lower price elasticity of demand than cornflakes because it is more broadly defined. 
E) Because cornflakes is food,but not all food is cornflakes,cornflakes would have a lower price elasticity of demand.

Question 3

When the percentage change in quantity demanded is less than the percentage change in price that brought it about,demand is said to be

Accepted Answer

A) zero elastic. 
B) elastic. 
C) unelastic. 
D) inelastic. 
E) unit elastic. 
A) zero elastic. 
B) elastic. 
C) unelastic. 
D) inelastic. 
E) unit elastic.

Question 4

When a product's price has an inverse relationship with total expenditure,then demand has a price elasticity of

Accepted Answer

A) one. 
B) inverse proportions. 
C) zero. 
D) less than one. 
E) greater than one. 
A) one. 
B) inverse proportions. 
C) zero. 
D) less than one. 
E) greater than one.

Question 5

Suppose that the quantity of lemonade demanded falls from 103 000 litres per week to 97 000 litres per week as a result of a 10% increase in its price.The price elasticity of demand for lemonade is therefore

Accepted Answer

A) 1.03. 
B) 6.0. 
C) 1.97. 
D) 0.6. 
E) impossible to compute unless we know the before and after prices. 
A) 1.03. 
B) 6.0. 
C) 1.97. 
D) 0.6. 
E) impossible to compute unless we know the before and after prices.

If the total expenditure on perfume increases when the price of perfume falls,the price elasticity of demand is

Which of the following statements would you expect to be true about the demand elasticities for cornflakes and food?

When the percentage change in quantity demanded is less than the percentage change in price that brought it about,demand is said to be

When a product's price has an inverse relationship with total expenditure,then demand has a price elasticity of

Suppose that the quantity of lemonade demanded falls from 103 000 litres per week to 97 000 litres per week as a result of a 10% increase in its price.The price elasticity of demand for lemonade is therefore

Economic Issues and Concepts

Economic Theories,data,and Graphs

Demand,supply,and Price

Markets in Action

Consumer Behaviour

Producers in the Short Run

Producers in the Long Run

Competitive Markets

Monopoly,cartels,and Price Discrimination

Imperfect Competition and Strategic Behaviour

Economic Efficiency and Public Policy

How Factor Markets Work

Labour Markets

Interest Rates and the Capital Market

Market Failures and Government Intervention

The Economics of Environmental Protection

Taxation and Public Expenditure

The Gains From International Trade

Trade Policy

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Exam 4: Elasticity

If the total expenditure on perfume increases when the price of perfume falls,the price elasticity of demand is

Which of the following statements would you expect to be true about the demand elasticities for cornflakes and food?

When the percentage change in quantity demanded is less than the percentage change in price that brought it about,demand is said to be

When a product's price has an inverse relationship with total expenditure,then demand has a price elasticity of

Suppose that the quantity of lemonade demanded falls from 103 000 litres per week to 97 000 litres per week as a result of a 10% increase in its price.The price elasticity of demand for lemonade is therefore

Economic Issues and Concepts

Economic Theories,data,and Graphs

Demand,supply,and Price

Markets in Action

Consumer Behaviour

Producers in the Short Run

Producers in the Long Run

Competitive Markets

Monopoly,cartels,and Price Discrimination

Imperfect Competition and Strategic Behaviour

Economic Efficiency and Public Policy

How Factor Markets Work

Labour Markets

Interest Rates and the Capital Market

Market Failures and Government Intervention

The Economics of Environmental Protection

Taxation and Public Expenditure

The Gains From International Trade

Trade Policy

Filters