Exam 5: Elasticity and Its Application

Figure 5-4 -Refer to Figure 5-4. Assume the section of the demand curve from B to C corresponds to prices between $0 and $15. Then, when the price changes between $7 and $9,

You and your college roommate eat three packages of Ramen noodles each week. After graduation last month, both of you were hired at several times your college income. Your roommate still enjoys Ramen noodles very much and buys even more, but you plan to buy fewer Ramen noodles in favor of foods you prefer more. When looking at income elasticity of demand for Ramen noodles, yours would

Which of the following statements about agriculture in the U.S. is correct?

The supply of a good will be more elastic, the

Figure 5-21 -Refer to Figure 5-21. Using the midpoint method, what is the price elasticity of supply between $15 and $25?

Figure 5-12 -Refer to Figure 5-12. Using the midpoint method, the price elasticity of demand between point Y and point Z is

Figure 5-1 -Refer to Figure 5-1. Between point A and point B, the slope is equal to

Table 5-5 -Refer to Table 5-5. As price rises from $7 to $8, the price elasticity of demand using the midpoint method is approximately

Figure 5-13 -Refer to Figure 5-13. Between point A and point B on the graph, demand is

Table 5-4 The following table shows the demand schedule for a particular good. -Refer to Table 5-4. Using the midpoint method, what is the price elasticity of demand when price rises from $12 to $16?

As we move downward and to the right along a linear, downward-sloping demand curve,

Figure 5-5 -Refer to Figure 5-5. Using the midpoint method, between prices of $50 and $60, price elasticity of demand is about

If demand is price inelastic, then when price rises, total revenue

Figure 5-3 -Refer to Figure 5-3. Which demand curve is perfectly elastic?

Consider the following pairs of goods. For which of the two goods would you expect the demand to be more price elastic? Why? a.water or diamonds b.insulin or nasal decongestant spray c.food in general or breakfast cereal d.gasoline over the course of a week or gasoline over the course of a year e. personal computers or IBM personal computers

If the income elasticity of demand for a good is -1.40, is the good a normal or inferior good?

The demand for bread is likely to be more elastic than the demand for solid-gold bread plates.

If the price of milk rises, when is the price elasticity of demand likely to be the lowest?

When demand is inelastic, a decrease in price increases total revenue.

Which of the following is likely to have the most price inelastic demand?