Exam 7: Consumer Choice and Elasticity

When the price of Nike tennis shoes goes from $100 to $80, the quantity demanded increases from 20 to 30 million. Over this price range, the absolute value of the price elasticity of demand is

If the price of apples rises from $.50 to $1.50 and quantity demanded falls from 1,000 to 900, we can conclude that the price elasticity for apples is

Figure 7-17 Consider Figure 7-17. Between the prices of $5 and $6, which supply curve is most elastic and which is least elastic?

As people have more time to adjust to a price change,

All things equal, the price elasticity of supply

A good with a high income elasticity is generally considered to be

An increase in the consumption of a good resulting from a reduction in price that makes the good cheaper in relation to other goods is called the

Suppose that the quantity of DVD players sold increased from 200 to 400 when the price fell from $225 to $175. Over this price range, the absolute value of the price elasticity of demand for DVD players is

If the board of regents of a major state university system plans to raise tuition in order to increase revenues, the regents must believe student demand is

If Mr. Smith thinks the last dollar spent on shirts yields more satisfaction than the last dollar spent on cola, and Smith is a utility-maximizing consumer, he should

Fred, a poor college student, states: "I eat tuna sandwiches five times a week. When I graduate and get a real job, I will never purchase tuna again." Is Fred planning on breaking the law of demand?

If the elasticity of demand for cigarettes is 0.4, then an increase in the price of a pack of cigarettes from $1.00 to $1.30 would reduce quantities demanded by about

Muriel's income elasticity of demand for football tickets is 1.5. All else equal, this means that if her income increases by 20 percent, she will buy

The demand for salt is

An inferior good is a good whose quantity demanded

When demand is price inelastic,

Demand will be more inelastic when

If bus travel is an inferior good, then its income elasticity of demand will be

If a 10 percent rise in airfares leads to a 5 percent increase in total expenditures on air travel, the price elasticity of demand for air travel in this range must be

If a large percentage increase in the price of a good results in a small percentage reduction in the quantity demanded of the good, demand is said to be