Exam 4: Elasticity

Suppose that the quantity demanded of paperback novels rises from 80 000 to 120 000 units per month when the price falls from $11 to $9 per unit. The price elasticity of demand for this product is

Nancyʹs income has just risen from $950 per week to $1050 per week. As a result, she decides to double the number of movies she attends each week. Nancyʹs demand for movies is

If the value of the price elasticity of demand is 0.6, demand is said to be

What does the following statement imply about price elasticity of demand? ʺAn unexpected spike in world oil prices leads to dramatic increase in revenue for the worldʹs oil producers.ʺ

Suppose Statistics Canada reports that total income earned by Canadian barley farmers has declined as a result of a partial crop failure that has driven up the Canadian price of barley. We can conclude that the price elasticity of demand for barley in Canada is

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

FIGURE 4-2 -Refer to Figure 4-2. In diagram 1, the elasticity of demand over the price range $12 to $14 is

Suppose that the quantity demanded of skipping ropes rises from 1250 to 1750 units when the price falls from $1)25 to $0.75 per unit. The price elasticity of demand for this product is

FIGURE 4-1 -Refer to Figure 4-1, which shows two demand curves, one linear and the other a rectangular hyperbola. The price elasticity of demand is equal to one along the entire demand curve in

If two goods, X and Y, have a positive cross elasticity of demand, then we know that they

The table below shows the demand schedule for museum admissions in a small city. TABLE 4-1 -Refer to Table 4-1. Between the prices of $2 and $4 the price elasticity of demand is

FIGURE 4-3 -Suppose the market supply curve for some good is upward sloping. If the imposition of an excise tax causes no change in the equilibrium quantity sold in the market, the goodʹs demand curve must be , meaning that the burden of the tax has fallen completely on the .

Which of the following illustrates elastic demand?

If the price elasticity of demand is 0.5, then a 10% increase in price results in a

Demand Schedule for Ski Tickets TABLE 4-2 -Refer to Table 4-2. The price elasticity of demand over the interval of the demand curve between prices of $40 and $20 is

Suppose national income is rising steadily at 2% per year over a 5-year period. Over the same time period, suppose quantity demanded for iPods and iPhones increases at 5% per year, but no other relevant variables are changing. We can conclude that the income elasticity for these products is and that these products are goods.

A demand curve for which any price-quantity combination yields the same total expenditure reveals a price elasticity of demand equal to

Which of the following statements would you expect to be true about price elasticities of demand for T -shirts and clothing?

Suppose the cross elasticity of demand between two goods, X and Y, is negative. If the price of X decreases, the quantity demanded will

Rania is selling boxes of cookies door to door in her neighbourhood. At a price of $10 per box she sold 40 boxes per day. When the price was reduced to $4 per box she sold 100 boxes per day. Assuming that the demand conditions were unchanged, what is the price elasticity of demand for Raniaʹs cookies?