Question 1

The percentage change in quantity demanded divided by the percentage change in income is referred to as the

Accepted Answer

A) price elasticity of demand 
B) income elasticity of demand 
C) cross-price elasticity of demand 
D) slope of the demand curve 
E) demand curve 
A) price elasticity of demand 
B) income elasticity of demand 
C) cross-price elasticity of demand 
D) slope of the demand curve 
E) demand curve

Question 2

-Bill's Office Furniture sells office chairs and desks.Bill's has changed the price per chair by $10 in each of four successive weeks.Figure 5-12 shows the four prices along with the corresponding sales of desks.From this information,it can be seen that

Accepted Answer

A) office chairs and desks are unrelated goods 
B) office chairs and desks are complementary goods 
C) office chairs and desks are substitute goods 
D) both goods are normal goods 
E) both goods obey the law of demand 
A) office chairs and desks are unrelated goods 
B) office chairs and desks are complementary goods 
C) office chairs and desks are substitute goods 
D) both goods are normal goods 
E) both goods obey the law of demand

Question 3

If demand is perfectly inelastic,

Accepted Answer

A) the percent change in quantity demanded divided by the percent change in price is zero 
B) the demand curve is a vertical line 
C) supply is perfectly inelastic too 
D) consumers have power over prices 
E) the percentage change in price divided by the percentage change in quantity demanded is zero 
A) the percent change in quantity demanded divided by the percent change in price is zero 
B) the demand curve is a vertical line 
C) supply is perfectly inelastic too 
D) consumers have power over prices 
E) the percentage change in price divided by the percentage change in quantity demanded is zero

Question 4

The percent change in the quantity of one commodity demanded divided by the percent change in the price of another commodity is the

Accepted Answer

A) price elasticity of demand 
B) price elasticity of supply 
C) income elasticity of demand 
D) income elasticity of supply 
E) cross-price elasticity of demand 
A) price elasticity of demand 
B) price elasticity of supply 
C) income elasticity of demand 
D) income elasticity of supply 
E) cross-price elasticity of demand

Question 5

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

Accepted Answer

A) margarine 
B) Tide detergent 
C) cigarettes 
D) Coca-Cola 
E) ground beef 
A) margarine 
B) Tide detergent 
C) cigarettes 
D) Coca-Cola 
E) ground beef

Question 6

If a 20 percent decrease in the price of chicken results in a 10 percent increase in the quantity demanded,the price elasticity of demand has a value of

Accepted Answer

A) 0.5 
B) 2 
C) 1 
D) 0.1 
E) none of these 
A) 0.5 
B) 2 
C) 1 
D) 0.1 
E) none of these

Question 7

Price elasticity of supply

Accepted Answer

A) is always a number between 0 and 1 
B) is always a negative number 
C) is always greater than or equal to 0 
D) is always greater than 1. 
E) can take on any value. 
A) is always a number between 0 and 1 
B) is always a negative number 
C) is always greater than or equal to 0 
D) is always greater than 1. 
E) can take on any value.

Question 8

The price elasticity of demand measures the responsiveness of quantity demanded to changes in price.

Accepted Answer

A) True 
 B)False

Question 9

If a change in price does not lead to any change in revenue,then demand over that range of prices is inelastic.

Accepted Answer

A) True 
 B)False

Question 10

-In Figure 5-3,the price elasticity of demand equals __________ between points T and U and equals __________ between points V and W.

Accepted Answer

A) 0.33;1.86 
B) 0.54;3 
C) 3;0.54 
D) 1.86;0.33 
E) 2;2 
A) 0.33;1.86 
B) 0.54;3 
C) 3;0.54 
D) 1.86;0.33 
E) 2;2

Question 11

If the price of food falls by 10 percent and the quantity sold increases by 5 percent,then the price elasticity of demand in that range equals

Accepted Answer

A) 2,and demand is elastic 
B) 0.5,and demand is elastic 
C) 2,and demand is inelastic 
D) 0.5,and demand is inelastic 
E) 15,and demand is elastic 
A) 2,and demand is elastic 
B) 0.5,and demand is elastic 
C) 2,and demand is inelastic 
D) 0.5,and demand is inelastic 
E) 15,and demand is elastic

Question 12

The supply of a good is more price elastic

Accepted Answer

A) the more alternatives there are to producing the good in question 
B) the more broadly the market for the good is defined. 
C) the shorter the time horizon over which it is measured. 
D) the higher the cost of production. 
E) the more elastic the demand for that good. 
A) the more alternatives there are to producing the good in question 
B) the more broadly the market for the good is defined. 
C) the shorter the time horizon over which it is measured. 
D) the higher the cost of production. 
E) the more elastic the demand for that good.

Question 13

-Figure 5-4 shows the demand schedule for hockey pucks.What is the price elasticity of demand when the price changes from $2 per puck to $1 per puck (using the midpoint formula)?

Accepted Answer

A) 0.33 
B) 0.15 
C) 3.00 
D) 1.00 
E) none of these 
A) 0.33 
B) 0.15 
C) 3.00 
D) 1.00 
E) none of these

Question 14

If the price elasticity of demand for Cheer detergent is 3.0,then a

Accepted Answer

A) 12 percent drop in price leads to a 36 percent rise in the quantity demanded 
B) 12 percent drop in price leads to a 4 percent rise in the quantity demanded 
C) $1,000 drop in price leads to a 3,000-unit rise in the quantity demanded 
D) $1,000 drop in price leads to a 333-unit rise in the quantity demanded 
E) 12 percent rise in price leads to a 36 percent rise in the quantity demanded 
A) 12 percent drop in price leads to a 36 percent rise in the quantity demanded 
B) 12 percent drop in price leads to a 4 percent rise in the quantity demanded 
C) $1,000 drop in price leads to a 3,000-unit rise in the quantity demanded 
D) $1,000 drop in price leads to a 333-unit rise in the quantity demanded 
E) 12 percent rise in price leads to a 36 percent rise in the quantity demanded

Question 15

If the demand for good A is more elastic than the demand for good B,a small decrease in supply in both markets will cause

Accepted Answer

A) a much greater increase in price for good A than for good B 
B) a much greater increase in price for good B than for good A 
C) the price will increase by the same amount in both markets 
D) only the price of good B will increase 
E) only the price of good A will increase 
A) a much greater increase in price for good A than for good B 
B) a much greater increase in price for good B than for good A 
C) the price will increase by the same amount in both markets 
D) only the price of good B will increase 
E) only the price of good A will increase

Question 16

The effect of a change in the price of tea on the quantity of coffee demanded is measured by the

Accepted Answer

A) price elasticity of demand 
B) substitute elasticity of demand 
C) cross-price elasticity of demand 
D) income elasticity of demand 
E) alternative elasticity of demand 
A) price elasticity of demand 
B) substitute elasticity of demand 
C) cross-price elasticity of demand 
D) income elasticity of demand 
E) alternative elasticity of demand

Question 17

For which of the following is demand likely to be the most price elastic?

Accepted Answer

A) a good for which there are no close substitutes 
B) a good for which there are no easily-obtained substitutes 
C) a good with close substitutes that are difficult to obtain 
D) a good that is no longer being produced 
E) a good for which close substitutes are easily obtained 
A) a good for which there are no close substitutes 
B) a good for which there are no easily-obtained substitutes 
C) a good with close substitutes that are difficult to obtain 
D) a good that is no longer being produced 
E) a good for which close substitutes are easily obtained

Question 18

-If demand for a good is represented by curve D" in Figure 5-10,then an increase in supply of the good will cause the equilibrium

Accepted Answer

A) price to fall,but revenue will not change 
B) quantity to fall,but revenue to rise 
C) quantity to rise,but revenue will not change 
D) price to rise,but revenue to fall 
E) price to fall.Seller's total revenue could rise or fall depending on the price elasticity of demand 
A) price to fall,but revenue will not change 
B) quantity to fall,but revenue to rise 
C) quantity to rise,but revenue will not change 
D) price to rise,but revenue to fall 
E) price to fall.Seller's total revenue could rise or fall depending on the price elasticity of demand

Question 19

If the percentage change in quantity demanded is greater (in absolute value)than the percentage change in price,then demand

Accepted Answer

A) determines supply 
B) is indeterminate 
C) is elastic 
D) is inelastic 
E) is unit elastic 
A) determines supply 
B) is indeterminate 
C) is elastic 
D) is inelastic 
E) is unit elastic

Question 20

If the income elasticity of demand for a good is -2.5,then

Accepted Answer

A) it is a normal good,and its demand curve will shift to the left if buyers' incomes increase 
B) it is a normal good,and its demand curve will shift to the right if buyers' incomes increase 
C) it is an inferior good,and its demand curve will shift to the right if buyers' incomes increase 
D) it is an inferior good,and its demand curve will shift to the left if buyers' incomes increase 
E) there is insufficient information to determine whether the good is normal or inferior 
A) it is a normal good,and its demand curve will shift to the left if buyers' incomes increase 
B) it is a normal good,and its demand curve will shift to the right if buyers' incomes increase 
C) it is an inferior good,and its demand curve will shift to the right if buyers' incomes increase 
D) it is an inferior good,and its demand curve will shift to the left if buyers' incomes increase 
E) there is insufficient information to determine whether the good is normal or inferior

The percentage change in quantity demanded divided by the percentage change in income is referred to as the

-Bill's Office Furniture sells office chairs and desks.Bill's has changed the price per chair by $10 in each of four successive weeks.Figure 5-12 shows the four prices along with the corresponding sales of desks.From this information,it can be seen that

If demand is perfectly inelastic,

The percent change in the quantity of one commodity demanded divided by the percent change in the price of another commodity is the

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

If a 20 percent decrease in the price of chicken results in a 10 percent increase in the quantity demanded,the price elasticity of demand has a value of

Price elasticity of supply

The price elasticity of demand measures the responsiveness of quantity demanded to changes in price.

If a change in price does not lead to any change in revenue,then demand over that range of prices is inelastic.

-In Figure 5-3,the price elasticity of demand equals between points T and U and equals between points V and W.

If the price of food falls by 10 percent and the quantity sold increases by 5 percent,then the price elasticity of demand in that range equals

The supply of a good is more price elastic

-Figure 5-4 shows the demand schedule for hockey pucks.What is the price elasticity of demand when the price changes from $2 per puck to $1 per puck (using the midpoint formula)?

If the price elasticity of demand for Cheer detergent is 3.0,then a

If the demand for good A is more elastic than the demand for good B,a small decrease in supply in both markets will cause

The effect of a change in the price of tea on the quantity of coffee demanded is measured by the

For which of the following is demand likely to be the most price elastic?

-If demand for a good is represented by curve D" in Figure 5-10,then an increase in supply of the good will cause the equilibrium

If the percentage change in quantity demanded is greater (in absolute value)than the percentage change in price,then demand

If the income elasticity of demand for a good is -2.5,then

What Is Economics

Scarcity, choice, and Economic Systems

Supply and Demand

Working With Supply and Demand

Consumer Choice

Production and Cost

How Firms Make Decisions: Profit Maximization

Perfect Competition

B:Perfect Competition

Monopolistic Competition and Oligopoly

Monopoly

Labor Markets

B: Labor Markets

Capital and Financial Markets

Economic Efficiency and the Competitive Ideal

Governments Role in Economic Efficiency

Comparative Advantage and the Gains From International Trade

Filters

Exam 5: Elasticity

The percentage change in quantity demanded divided by the percentage change in income is referred to as the

-Bill's Office Furniture sells office chairs and desks.Bill's has changed the price per chair by $10 in each of four successive weeks.Figure 5-12 shows the four prices along with the corresponding sales of desks.From this information,it can be seen that

If demand is perfectly inelastic,

The percent change in the quantity of one commodity demanded divided by the percent change in the price of another commodity is the

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

If a 20 percent decrease in the price of chicken results in a 10 percent increase in the quantity demanded,the price elasticity of demand has a value of

Price elasticity of supply

The price elasticity of demand measures the responsiveness of quantity demanded to changes in price.

If a change in price does not lead to any change in revenue,then demand over that range of prices is inelastic.

-In Figure 5-3,the price elasticity of demand equals __________ between points T and U and equals __________ between points V and W.

If the price of food falls by 10 percent and the quantity sold increases by 5 percent,then the price elasticity of demand in that range equals

The supply of a good is more price elastic

-Figure 5-4 shows the demand schedule for hockey pucks.What is the price elasticity of demand when the price changes from $2 per puck to $1 per puck (using the midpoint formula)?

If the price elasticity of demand for Cheer detergent is 3.0,then a

If the demand for good A is more elastic than the demand for good B,a small decrease in supply in both markets will cause

The effect of a change in the price of tea on the quantity of coffee demanded is measured by the

For which of the following is demand likely to be the most price elastic?

-If demand for a good is represented by curve D" in Figure 5-10,then an increase in supply of the good will cause the equilibrium

If the percentage change in quantity demanded is greater (in absolute value)than the percentage change in price,then demand

If the income elasticity of demand for a good is -2.5,then

What Is Economics

Scarcity, choice, and Economic Systems

Supply and Demand

Working With Supply and Demand

Consumer Choice

Production and Cost

How Firms Make Decisions: Profit Maximization

Perfect Competition

B:Perfect Competition

Monopolistic Competition and Oligopoly

Monopoly

Labor Markets

B: Labor Markets

Capital and Financial Markets

Economic Efficiency and the Competitive Ideal

Governments Role in Economic Efficiency

Comparative Advantage and the Gains From International Trade

Filters

-In Figure 5-3,the price elasticity of demand equals between points T and U and equals between points V and W.