Exam 5: Elasticity and Its Application

Suppose that an increase in the price of melons from $1.30 to $1.80 per pound increases the quantity of melons that melon farmers produce from 1.2 million pounds to 1.6 million pounds.Using the midpoint method,what is the approximate value of the price elasticity of supply?

When the price of good A is $50,the quantity demanded of good A is 500 units.When the price of good A rises to $70,the quantity demanded of good A falls to 400 units.Using the midpoint method,the price elasticity of demand for good A is

Elasticity of demand is closely related to the slope of the demand curve.The more responsive buyers are to a change in price,the

Table 5-3 The following table shows the demand schedule for a particular good. -Refer to Table 5-3.Using the midpoint method,what is the price elasticity of demand when price rises from $9 to $12?

Elasticity measures how responsive quantity is to changes in price.

Cross-price elasticity is used to determine whether goods are substitutes or complements.

Food and clothing tend to have

Suppose the price elasticity of supply for soccer balls is 0.3 in the short run and 1.2 in the long run.If an increase in the demand for soccer balls causes the price of soccer balls to increase by 20%,then the quantity supplied of soccer balls will increase by about

The demand for soap is more elastic than the demand for Dove soap.

In the market for oil in the short run,demand

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

How does total revenue change as one moves downward and to the right along a linear demand curve?

In the case of perfectly inelastic demand,

Under which of the following conditions would the interdiction of illegal drugs result in a decrease in the quantity of drugs sold and in a decrease in total spending on illegal drugs by drug users?

Pierre says that he will spend exactly 75 cents a day on candy bars,regardless of the price of candy bars.Pierre's demand for candy bars is

If a 20% change in price results in a 15% change in quantity supplied,then the price elasticity of supply is about

How did the farm population in the United States change between 1950 and today?

Table 5-6 -Refer to Table 5-6.Using the midpoint method,what is the income elasticity of demand for good X?

Suppose that when the price rises by 20% for a particular good,the quantity demanded of that good falls by 10%.The price elasticity of demand for this good is equal to 2.0.

If the price elasticity of demand for a good is 0.4,then a 10 percent increase in price results in a