Exam 5: Elasticity of demand and supply

Exhibit 5-4 Supply and demand curves for cigarettes -As shown in Exhibit 5-4,assume the government places a $1 per pack sales tax on cigarettes.The percentage of the burden of taxation paid by consumers of a pack of cigarettes is:

Suppose that the quantity of apples sold increases by 30 per cent after the price of pears increases by 15 per cent.What is the coefficient of the cross elasticity of demand?

An economist estimates that 0.67 is the price elasticity of demand for disposable diapers.This suggests that disposable diaper producers could:

The number of satellite dishes increased by 50 per cent when the average monthly price of cable television increased by 10 per cent.Assuming that other factors are held constant,satellite dishes and cable television are classified as:

Suppose that the quantity of cars sold decreases by 5 per cent after the price of motorbikes decreases by 20 per cent.What is the coefficient of the cross elasticity of demand?

If the income elasticity of demand for a good is 1.75,then it is what type of good?

If the government wants to raise tax revenue and shift most of the tax burden to the sellers it would impose a tax on a good with:

Petrol has inelastic price elasticity of demand in both short and long run but chinaware has elastic price elasticity of demand in both short and long run because:

The number of computers bought increased by 20 per cent when the price of online services declined by 10 per cent.Assuming other factors are held constant,computers and online services are classified as:

If a good only takes up a small proportion of your income,the elasticity of demand is likely to be:

The income elasticity of demand for cars is estimated to be 5.5 in the short run.We can conclude that:

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

The cross elasticity between two goods,X and Y,is positive.From this,we can conclude that goods X and Y are:

If margarine and butter are substitutes,then their cross-elasticity coefficient will be:

Which of the following statements is not true?

Suppose the price of a bus ticket rises from $2.75 to $3 and the number of tickets sold falls from 10 000 to 8500,the total revenue test:

Price elasticity of demand measures:

As price decreases and we move down further along a linear demand curve,the price elasticity of demand will:

Which statement about price elasticity of demand along a linear demand curve is true?

If the price elasticity of supply equals zero,this implies that: