Question 1

Alfred Marshall recognized time in the determination of supply elasticity.His 'momentary market period' is shown through a short-run supply curve which is:

Accepted Answer

A) perfectly elastic. 
B) elastic. 
C) inelastic. 
D) perfectly inelastic. 
E) It could either be elastic or have unitary elasticity. 
A) perfectly elastic. 
B) elastic. 
C) inelastic. 
D) perfectly inelastic. 
E) It could either be elastic or have unitary elasticity.

Question 2

What is the effect on tax revenue if the government increases the excise tax on a product that has an inelastic demand?

Accepted Answer

A) Tax revenue will rise. 
B) Tax revenue will fall. 
C) The price of the product will rise but the quantity traded will remain unchanged. 
D) The price of the product will rise and the quantity traded will rise. 
A) Tax revenue will rise. 
B) Tax revenue will fall. 
C) The price of the product will rise but the quantity traded will remain unchanged. 
D) The price of the product will rise and the quantity traded will rise.

Question 3

-If the price of Moonlight massage oil decreases from $3 to $2.50 and,as a result,total revenue of $6,000 does not change,what is the elasticity of demand?

Accepted Answer

A) 0.22. 
B) 0.55. 
C) 1. 
D) 1.2. 
E) 1.67. 
A) 0.22. 
B) 0.55. 
C) 1. 
D) 1.2. 
E) 1.67.

Question 4

If the quantity of cheese supplied increased by 18% when the price increased by 12%,what is the value of the elasticity of supply?

Accepted Answer

The elasti

Question 5

-Refer to the graph above to answer this question.Which of the following statements is correct?

Accepted Answer

A) The demand curves in graphs I,II and III are,respectively,perfectly elastic,inelastic and perfectly inelastic. 
B) The demand curves in graphs I,II and III are,respectively,perfectly inelastic,inelastic and perfectly elastic. 
C) The demand curves in graphs I,II and III are,respectively,perfectly inelastic,unitary elastic and perfectly elastic. 
D) All three demand curves have an elastic and an inelastic portion to them. 
A) The demand curves in graphs I,II and III are,respectively,perfectly elastic,inelastic and perfectly inelastic. 
B) The demand curves in graphs I,II and III are,respectively,perfectly inelastic,inelastic and perfectly elastic. 
C) The demand curves in graphs I,II and III are,respectively,perfectly inelastic,unitary elastic and perfectly elastic. 
D) All three demand curves have an elastic and an inelastic portion to them.

Question 6

-Refer to the information above to answer this question.What will be the equilibrium price and quantity if a $2 per unit excise tax is imposed on this product?

Accepted Answer

A) $11 and 40. 
B) $11 and 80. 
C) $10 and 50. 
D) $10 and 70. 
E) $7 and 40. 
A) $11 and 40. 
B) $11 and 80. 
C) $10 and 50. 
D) $10 and 70. 
E) $7 and 40.

Question 7

What is the relationship between the form of elasticity (e.g.unitary)and total revenue?

Accepted Answer

If the demand is inelastic,price and tot

Question 8

Suppose that average incomes increased from $30,000 to $34,000,and the quantity demanded of a product increased from 45 to 55.What type of product must this be?

Accepted Answer

A) Substitute product. 
B) Inferior product. 
C) Luxury product. 
D) Necessity. 
E) Superior product. 
A) Substitute product. 
B) Inferior product. 
C) Luxury product. 
D) Necessity. 
E) Superior product.

Question 9

-Refer to the information above to answer this question.At what price is total revenue maximized?

Accepted Answer

A) $14. 
B) $16. 
C) $18. 
D) $20. 
E) $22. 
A) $14. 
B) $16. 
C) $18. 
D) $20. 
E) $22.

Question 10

What is the significance of a positive cross-elasticity coefficient between products X and Y?

Accepted Answer

A) The demand for both products must be elastic. 
B) The demand for both products must be inelastic. 
C) Products X and Y must be substitutes. 
D) Products X and Y must be complements. 
E) There is no significance since all calculations of cross elasticity are positive. 
A) The demand for both products must be elastic. 
B) The demand for both products must be inelastic. 
C) Products X and Y must be substitutes. 
D) Products X and Y must be complements. 
E) There is no significance since all calculations of cross elasticity are positive.

Question 11

If a product has many substitutes,which of the following statements is correct?

Accepted Answer

A) Its income elasticity is high. 
B) It is likely that it is an inferior product. 
C) Its supply elasticity is high. 
D) Its price elasticity of demand is high. 
A) Its income elasticity is high. 
B) It is likely that it is an inferior product. 
C) Its supply elasticity is high. 
D) Its price elasticity of demand is high.

Question 12

What is price elasticity of demand?

Accepted Answer

A) The responsiveness of price to a change in the quantity demanded. 
B) The responsiveness of quantity demanded to a change in price. 
C) Price divided by quantity demanded. 
D) Price multiplied by quantity demanded. 
A) The responsiveness of price to a change in the quantity demanded. 
B) The responsiveness of quantity demanded to a change in price. 
C) Price divided by quantity demanded. 
D) Price multiplied by quantity demanded.

Question 13

Suppose that the price of a product increased from $18 to $22,and the quantity demanded decreased from 63 to 57.What is the value of the price elasticity of demand?

Accepted Answer

A) 0.43. 
B) 0.5. 
C) 1.5. 
D) 2.0. 
E) 2.3. 
A) 0.43. 
B) 0.5. 
C) 1.5. 
D) 2.0. 
E) 2.3.

Question 14

What does the term elastic demand mean?

Accepted Answer

A) Quantities demanded which are not very responsive to a change in price. 
B) The responsiveness of quantity demanded to a change in price. 
C) An elasticity coefficient which is equal to one. 
D) Quantities demanded which are quite responsive to a change in price. 
E) The responsiveness of price to a change in quantity demanded. 
A) Quantities demanded which are not very responsive to a change in price. 
B) The responsiveness of quantity demanded to a change in price. 
C) An elasticity coefficient which is equal to one. 
D) Quantities demanded which are quite responsive to a change in price. 
E) The responsiveness of price to a change in quantity demanded.

Question 15

The graph below shows the supply and demand for tickets to a Raptors basketball game.
  
-Refer to the graph above to answer this question.What is the supply elasticity in the $30 to $40 range?

Accepted Answer

A) 0. 
B) 0.26. 
C) 2.33. 
D) 3.9. 
A) 0. 
B) 0.26. 
C) 2.33. 
D) 3.9.

Question 16

-Refer to the information above to answer this question.If the government imposes a $2 per unit sales tax on this product,how much of that tax will consumers pay and how much will sellers pay?

Accepted Answer

A) Consumers will pay all $2 of the tax. 
B) Consumers will pay $1.50 and sellers $.50. 
C) Consumers and sellers will each pay $1. 
D) Consumers will pay $.50 and seller $1.50. 
E) Sellers will pay all $2 of the tax. 
A) Consumers will pay all $2 of the tax. 
B) Consumers will pay $1.50 and sellers $.50. 
C) Consumers and sellers will each pay $1. 
D) Consumers will pay $.50 and seller $1.50. 
E) Sellers will pay all $2 of the tax.

Question 17

What does the elasticity coefficient refer to?

Accepted Answer

A) It is price multiplied by the quantity of the product sold. 
B) It indicates the responsiveness of quantity demanded to a change in price. 
C) It is the responsiveness of price to a change in quantity demanded. 
D) It is quantity demanded at any given price. 
A) It is price multiplied by the quantity of the product sold. 
B) It indicates the responsiveness of quantity demanded to a change in price. 
C) It is the responsiveness of price to a change in quantity demanded. 
D) It is quantity demanded at any given price.

Question 18

According to Alfred Marshall,time plays a critical role in the determination of the elasticity of supply and the shape of the supply curves over time.What are these shapes?

Accepted Answer

The answer of According to Alfred Marshall,time plays a critical...

Question 19

The graph below illustrates three demand curves.
  
-Refer to the graph above to answer this question.Which of the following statements is correct?

Accepted Answer

A) The price elasticity of demand between points A and B on D2 is 0.5. 
B) D1 illustrates an inferior good. 
C) The slope of all three demand curves is constant. 
D) The shift from D1 to D2 could illustrate a change in the quantity demanded for a product as a result of a decrease in the price of a substitute good. 
A) The price elasticity of demand between points A and B on D2 is 0.5. 
B) D1 illustrates an inferior good. 
C) The slope of all three demand curves is constant. 
D) The shift from D1 to D2 could illustrate a change in the quantity demanded for a product as a result of a decrease in the price of a substitute good.

Question 20

-Refer to the graphs above to answer this question.Suppose that the price of nuts decreases from P1 to P2 and the demand curve for chocolates shifts to the right from D1 to D2.What is the effect to total revenue from the sale of both nuts and chocolates?

Accepted Answer

A) Total revenue will not change since the cross-elasticity coefficient is not known. 
B) Total revenue from the sale of chocolates will rise but not the total revenue from nuts. 
C) Total revenue may rise or fall depending on the size of the price decrease of nuts. 
D) Total revenue from the sale of both nuts and chocolates will fall. 
E) Total revenue from the sale of both nuts and chocolates will rise. 
A) Total revenue will not change since the cross-elasticity coefficient is not known. 
B) Total revenue from the sale of chocolates will rise but not the total revenue from nuts. 
C) Total revenue may rise or fall depending on the size of the price decrease of nuts. 
D) Total revenue from the sale of both nuts and chocolates will fall. 
E) Total revenue from the sale of both nuts and chocolates will rise.

Alfred Marshall recognized time in the determination of supply elasticity.His 'momentary market period' is shown through a short-run supply curve which is:

What is the effect on tax revenue if the government increases the excise tax on a product that has an inelastic demand?

-If the price of Moonlight massage oil decreases from $3 to $2.50 and,as a result,total revenue of $6,000 does not change,what is the elasticity of demand?

If the quantity of cheese supplied increased by 18% when the price increased by 12%,what is the value of the elasticity of supply?

-Refer to the graph above to answer this question.Which of the following statements is correct?

-Refer to the information above to answer this question.What will be the equilibrium price and quantity if a $2 per unit excise tax is imposed on this product?

What is the relationship between the form of elasticity (e.g.unitary)and total revenue?

Suppose that average incomes increased from $30,000 to $34,000,and the quantity demanded of a product increased from 45 to 55.What type of product must this be?

-Refer to the information above to answer this question.At what price is total revenue maximized?

What is the significance of a positive cross-elasticity coefficient between products X and Y?

If a product has many substitutes,which of the following statements is correct?

What is price elasticity of demand?

Suppose that the price of a product increased from $18 to $22,and the quantity demanded decreased from 63 to 57.What is the value of the price elasticity of demand?

What does the term elastic demand mean?

The graph below shows the supply and demand for tickets to a Raptors basketball game. -Refer to the graph above to answer this question.What is the supply elasticity in the $30 to $40 range?

-Refer to the information above to answer this question.If the government imposes a $2 per unit sales tax on this product,how much of that tax will consumers pay and how much will sellers pay?

What does the elasticity coefficient refer to?

According to Alfred Marshall,time plays a critical role in the determination of the elasticity of supply and the shape of the supply curves over time.What are these shapes?

The graph below illustrates three demand curves. -Refer to the graph above to answer this question.Which of the following statements is correct?

-Refer to the graphs above to answer this question.Suppose that the price of nuts decreases from P₁ to P₂ and the demand curve for chocolates shifts to the right from D₁ to D₂.What is the effect to total revenue from the sale of both nuts and chocolates?

The Economic Problem

Demand and Supply: An Introduction

Demand and Supply: An Elaboration

Consumer Choice

A Firms Production Decisions and Costs in the Short Run

Costs in the Long Run

Perfect Competition

An Evaluation of Competitive Markets

Monopoly

Imperfect Competition

The Factors of Production

International Trade

Filters

Exam 4: Elasticity

Alfred Marshall recognized time in the determination of supply elasticity.His 'momentary market period' is shown through a short-run supply curve which is:

What is the effect on tax revenue if the government increases the excise tax on a product that has an inelastic demand?

-If the price of Moonlight massage oil decreases from $3 to $2.50 and,as a result,total revenue of $6,000 does not change,what is the elasticity of demand?

If the quantity of cheese supplied increased by 18% when the price increased by 12%,what is the value of the elasticity of supply?

-Refer to the graph above to answer this question.Which of the following statements is correct?

-Refer to the information above to answer this question.What will be the equilibrium price and quantity if a $2 per unit excise tax is imposed on this product?

What is the relationship between the form of elasticity (e.g.unitary)and total revenue?

Suppose that average incomes increased from $30,000 to $34,000,and the quantity demanded of a product increased from 45 to 55.What type of product must this be?

-Refer to the information above to answer this question.At what price is total revenue maximized?

What is the significance of a positive cross-elasticity coefficient between products X and Y?

If a product has many substitutes,which of the following statements is correct?

What is price elasticity of demand?

Suppose that the price of a product increased from $18 to $22,and the quantity demanded decreased from 63 to 57.What is the value of the price elasticity of demand?

What does the term elastic demand mean?

The graph below shows the supply and demand for tickets to a Raptors basketball game. -Refer to the graph above to answer this question.What is the supply elasticity in the $30 to $40 range?

-Refer to the information above to answer this question.If the government imposes a $2 per unit sales tax on this product,how much of that tax will consumers pay and how much will sellers pay?

What does the elasticity coefficient refer to?

According to Alfred Marshall,time plays a critical role in the determination of the elasticity of supply and the shape of the supply curves over time.What are these shapes?

The graph below illustrates three demand curves. -Refer to the graph above to answer this question.Which of the following statements is correct?

-Refer to the graphs above to answer this question.Suppose that the price of nuts decreases from P1 to P2 and the demand curve for chocolates shifts to the right from D1 to D2.What is the effect to total revenue from the sale of both nuts and chocolates?

The Economic Problem

Demand and Supply: An Introduction

Demand and Supply: An Elaboration

Consumer Choice

A Firms Production Decisions and Costs in the Short Run

Costs in the Long Run

Perfect Competition

An Evaluation of Competitive Markets

Monopoly

Imperfect Competition

The Factors of Production

International Trade

Filters

-Refer to the graphs above to answer this question.Suppose that the price of nuts decreases from P₁ to P₂ and the demand curve for chocolates shifts to the right from D₁ to D₂.What is the effect to total revenue from the sale of both nuts and chocolates?