Exam 5: Elasticities of Demand and Supply

The figure above shows the supply curve for roses. -Suppose an increase in supply lowers the price from $10 to $8 and increases the quantity demanded from 100 units to 130 units.Using the midpoint method,the elasticity of demand equals

If a 10 percent price increase generates a 20 percent decrease in quantity demanded,then demand is

If a firm supplies 200 units at a price of $50 and 100 units at a price of $40,using the midpoint method,what is the price elasticity of supply?

For a good such as a large screen HD television set,the income elasticity would likely be

When supply is perfectly inelastic,the supply curve is

If the price elasticity of demand for a good is 2,then a 10 percent increase in the price of that good ________ the quantity demanded by ________ percent.

For a good such as food,the income elasticity is likely

Price (dollars) Quantity demanded (units per week) A 100 40 B 80 60 C 60 80 D 40 100 E 20 120 -The table above gives the demand schedule for a good.What is the total revenue at point A? At point B? At point C? At point D? At point E?

Explain why the cross elasticity of demand for substitute goods is positive and the cross elasticity of demand for complements is negative.

If the income elasticity of demand for a good is 2,then when income rises 10 percent,the quantity demanded

When the price of tacos rise 4 percent,the quantity demanded decreases 10 percent.What is the price elasticity of demand for tacos?

Which of the following statements is correct?

For a product with a constant or gently increasing opportunity cost of producing additional units,as more is produced,we expect that

The income elasticity of demand for movies in the United States is 3.41.If people's incomes decrease by 1 percent,what is the decrease in the quantity of movies demanded?

The cross elasticity of demand for butter and margarine is likely to be

If the price of a magazine increases from $5 to $7 and the quantity demanded of the magazines decreases from 10 million per month to 8 million per month,using the midpoint method,what is the price elasticity of demand? Show your work.Is the demand elastic,inelastic,or unit elastic?

Suppose a local photographer increases his prices by 8 percent and quantity demanded decreases by the same percentage.This set of facts indicates that the demand for his services is

Pizza Hut lowers the price of its pizza.The price elasticity of demand for Pizza Hut pizza equals 0.3.What happens to the Pizza Hut's total revenue?

If the price elasticity of demand for moose hunting lessons is 4.23,then the demand for moose hunting lessons is

If two goods are ________,then an increase in the price of one leads to ________ in the quantity demanded of the other.