Exam 6: Elasticity

(Last Word) Microsoft charges a substantially lower price for a software upgrade than for the initial purchase of the software. This implies that Microsoft views the demand curve for the software upgrade to be

The total revenue received by sellers of a good is computed by

The price elasticity of demand increases with the length of the period considered because

The greater the ease of shifting resources from product X to product Y in the production process, the greater is the elasticity of supply of product Y.

If price and total revenue vary in opposite directions, demand is

An increase in the price of tickets to a popular sporting event will increase total revenue if

The supply curve of a one-of-a-kind original painting is

Generally speaking, the demand for luxury goods is more price elastic than is the demand for necessities.

Economists distinguish among the immediate market period, the short run, and the long run by noting that

Suppose the price elasticity coefficients of demand are 1.43, 0.67, 1.11, and 0.29 for products W, X, Y, and Z, respectively. A 1 percent decrease in price will increase total revenue in the cases of

The demand for a product is inelastic with respect to price if

If the demand for a product increases proportionately faster than the increase in consumers' incomes, then the income elasticity of demand for the product is

Antiques tend to have highly inelastic supply curves.

Most goods can be classified as normal goods rather than inferior goods. The definition of a normal good suggests that

If sellers could price-discriminate and charge two different prices to two different groups of buyers in order to increase revenues, then the sellers would charge

If the coefficient of income elasticity of demand is positive, the product is an inferior good.

If the percentage change in quantity demanded is less than the percentage change in price, then demand is said to be elastic.

If a 10 percent increase in the price of one good results in no change in the quantity demanded of another good, then it can be concluded that the two goods are

The law of supply indicates that the price-elasticity of supply coefficient would have a negative sign.

The supply curve of antique reproductions is