Question 1

Total revenue will rise if

Accepted Answer

A) demand for a good is inelastic and its price rises. 
B) demand for a good is elastic and its price rises. 
C) demand for a good is inelastic and its price falls. 
D) None of these choices are true. 
A) demand for a good is inelastic and its price rises. 
B) demand for a good is elastic and its price rises. 
C) demand for a good is inelastic and its price falls. 
D) None of these choices are true.

Question 2

When demand is elastic

Accepted Answer

A) the percentage change in quantity is greater than the percentage change in price. 
B) a price increase lowers total revenue. 
C) buyers are sensitive to price changes. 
D) the elasticity coefficient is greater than one. 
E) All of the statements are true. 
A) the percentage change in quantity is greater than the percentage change in price. 
B) a price increase lowers total revenue. 
C) buyers are sensitive to price changes. 
D) the elasticity coefficient is greater than one. 
E) All of the statements are true.

Question 3

If consumers are price sensitive, then

Accepted Answer

A) they will have elastic demand curves. 
B) they will have inelastic demand curves. 
C) they will have no demand curve. 
D) they will not shop around very much. 
E) they likely perceive no close substitutes. 
A) they will have elastic demand curves. 
B) they will have inelastic demand curves. 
C) they will have no demand curve. 
D) they will not shop around very much. 
E) they likely perceive no close substitutes.

Question 4

When advertisers try to build brand loyalty they are trying to make their product more ______.

Accepted Answer

The answer of When advertisers try to build brand loyalty...

Question 5

If elasticity of demand is 4 and price is raised,

Accepted Answer

A) total revenue will fall. 
B) total revenue will rise. 
C) total revenue will remain constant. 
D) there is no way to determine whether total revenue will rise, fall, or remain constant. 
A) total revenue will fall. 
B) total revenue will rise. 
C) total revenue will remain constant. 
D) there is no way to determine whether total revenue will rise, fall, or remain constant.

Question 6

The elasticity of a perfectly horizontal line is _______; the elasticity of a perfectly vertical line is ____.

Accepted Answer

The answer of The elasticity of a perfectly horizontal line...

Question 7

Use the following figure to answer the question :  
-If price rises from $2 to $3 and the quantity demanded falls from 100 to 99, demand would be

Accepted Answer

A) 0.03 
B) 0.67 
C) 1.23 
D) 5.81 
A) 0.03 
B) 0.67 
C) 1.23 
D) 5.81

Question 8

Which of the following statements best represents the attitude of a consumer with a very elastic demand for golf clubs?

Accepted Answer

A) "The set of clubs that professional golfer Arnold Palmer use, are what I'll be swinging when I hit the golf course." 
B) "I'm generally pretty frugal, but I need all the help I can get when I meet with my weekly foursome.If one brand can give me an edge, the extra money is well spent." 
C) "I buy the brand of clubs I've used all my life.They've been good to me, so why would I even consider a bargain set of clubs?" 
D) "One golf club is as good as the next.It's the player not the club, so I don't get wrapped up in buying one brand of clubs over another." 
A) "The set of clubs that professional golfer Arnold Palmer use, are what I'll be swinging when I hit the golf course." 
B) "I'm generally pretty frugal, but I need all the help I can get when I meet with my weekly foursome.If one brand can give me an edge, the extra money is well spent." 
C) "I buy the brand of clubs I've used all my life.They've been good to me, so why would I even consider a bargain set of clubs?" 
D) "One golf club is as good as the next.It's the player not the club, so I don't get wrapped up in buying one brand of clubs over another."

Question 9

The elasticity all along a downward-sloping straight-line demand curve,

Accepted Answer

A) will be equal to -1 at all points. 
B) will be different at each point on the curve. 
C) will be equal to zero at all points. 
D) will be constant. 
A) will be equal to -1 at all points. 
B) will be different at each point on the curve. 
C) will be equal to zero at all points. 
D) will be constant.

Question 10

Use the following Figure to answer the question :  
-How much is the tax?

Accepted Answer

A) $1.35 
B) $1.65 
C) $2.00 
D) $3.00 
E) $4.00 
A) $1.35 
B) $1.65 
C) $2.00 
D) $3.00 
E) $4.00

Question 11

If your income goes up by 10% and you increase your pedicures by 5%, then your demand for pedicures is _______.

Accepted Answer

A) income elastic 
B) income inelastic 
C) income unit elastic 
A) income elastic 
B) income inelastic 
C) income unit elastic

Question 12

Which statement is the false?

Accepted Answer

A) Advertising will tend to shift the demand curve for the product to the right. 
B) The goal of advertising is to make a firm's demand curve less elastic. 
C) Advertising campaigns attempt to convince the consumer that the product is unique and a necessity. 
D) Advertisers go to great lengths to build brand loyalty, thereby making the demand for their products more elastic. 
A) Advertising will tend to shift the demand curve for the product to the right. 
B) The goal of advertising is to make a firm's demand curve less elastic. 
C) Advertising campaigns attempt to convince the consumer that the product is unique and a necessity. 
D) Advertisers go to great lengths to build brand loyalty, thereby making the demand for their products more elastic.

Question 13

Use the following figure to answer the question :  
-If demand is elastic and price is lowered, total revenue will

Accepted Answer

A) rise. 
B) fall. 
C) stay the same. 
D) possibly rise and possibly fall. 
A) rise. 
B) fall. 
C) stay the same. 
D) possibly rise and possibly fall.

Question 14

The demand for goods such as telephone service and medical care tend to be

Accepted Answer

A) perfectly elastic. 
B) relatively elastic. 
C) unit elastic. 
D) relatively inelastic. 
A) perfectly elastic. 
B) relatively elastic. 
C) unit elastic. 
D) relatively inelastic.

Question 15

Use the following figure to answer the question :  
-In the graph above

Accepted Answer

A) D1 is more inelastic than D2. 
B) D2 is more inelastic than D1. 
C) D1 and D2 have the same elasticity. 
D) There is no way to tell whether D1 or D2 is more elastic. 
A) D1 is more inelastic than D2. 
B) D2 is more inelastic than D1. 
C) D1 and D2 have the same elasticity. 
D) There is no way to tell whether D1 or D2 is more elastic.

Question 16

If a decrease in price leads to a decrease in total revenue,

Accepted Answer

A) demand is elastic. 
B) demand is inelastic. 
C) demand is unit elastic. 
D) there is not enough information to determine the elasticity of demand. 
A) demand is elastic. 
B) demand is inelastic. 
C) demand is unit elastic. 
D) there is not enough information to determine the elasticity of demand.

Question 17

If a 1% change in price leads to a 2% change in quantity demanded, then the elasticity of demand is

Accepted Answer

A) 0.5. 
B) 1.0. 
C) 1.5. 
D) 2.0. 
A) 0.5. 
B) 1.0. 
C) 1.5. 
D) 2.0.

Question 18

Which product will have the most elastic demand curve?

Accepted Answer

A) Thread 
B) Heating oil 
C) A new automobile 
D) Cigarettes 
A) Thread 
B) Heating oil 
C) A new automobile 
D) Cigarettes

Question 19

Use the following Figure to answer the question :  
-About how much of the tax is paid by cigarette sellers?

Accepted Answer

A) 2 cents 
B) 8 cents 
C) 10 cents 
D) 18 cents 
E) 20 cents 
A) 2 cents 
B) 8 cents 
C) 10 cents 
D) 18 cents 
E) 20 cents

Question 20

Use the following Figure to answer the question : 
 
-How much revenue will the government raise from the tax?

Accepted Answer

A) $12 million 
B) $24 million 
C) $30 million 
D) $36 million 
E) $42 million 
A) $12 million 
B) $24 million 
C) $30 million 
D) $36 million 
E) $42 million

Total revenue will rise if

When demand is elastic

If consumers are price sensitive, then

When advertisers try to build brand loyalty they are trying to make their product more ______.

If elasticity of demand is 4 and price is raised,

The elasticity of a perfectly horizontal line is ___; the elasticity of a perfectly vertical line is .

Use the following figure to answer the question : -If price rises from $2 to $3 and the quantity demanded falls from 100 to 99, demand would be

Which of the following statements best represents the attitude of a consumer with a very elastic demand for golf clubs?

The elasticity all along a downward-sloping straight-line demand curve,

Use the following Figure to answer the question : -How much is the tax?

If your income goes up by 10% and you increase your pedicures by 5%, then your demand for pedicures is _______.

Which statement is the false?

Use the following figure to answer the question : -If demand is elastic and price is lowered, total revenue will

The demand for goods such as telephone service and medical care tend to be

Use the following figure to answer the question : -In the graph above

If a decrease in price leads to a decrease in total revenue,

If a 1% change in price leads to a 2% change in quantity demanded, then the elasticity of demand is

Which product will have the most elastic demand curve?

Use the following Figure to answer the question : -About how much of the tax is paid by cigarette sellers?

Use the following Figure to answer the question : -How much revenue will the government raise from the tax?

A Brief Economic History of the United States

Resource Utilization

The Mixed Economy

Supply and Demand

Demand, Supply, and Equilibrium

Theory of Consumer Behavior

Cost

Profit, Loss, and Perfect Competition

Monopoly

Monopolistic Competition

Oligopoly

Corporate Mergers and Antitrust

Demand in the Factor Market

Labor Unions

Labor Markets and Wage Rates

Rent, Interest, and Profit

Income Distribution and Poverty

International Trade

International Finance

Filters

Exam 6: The Price Elasticities of Demand and Supply

Total revenue will rise if

When demand is elastic

If consumers are price sensitive, then

When advertisers try to build brand loyalty they are trying to make their product more ______.

If elasticity of demand is 4 and price is raised,

The elasticity of a perfectly horizontal line is _______; the elasticity of a perfectly vertical line is ____.

Use the following figure to answer the question : -If price rises from $2 to $3 and the quantity demanded falls from 100 to 99, demand would be

Which of the following statements best represents the attitude of a consumer with a very elastic demand for golf clubs?

The elasticity all along a downward-sloping straight-line demand curve,

Use the following Figure to answer the question : -How much is the tax?

If your income goes up by 10% and you increase your pedicures by 5%, then your demand for pedicures is _______.

Which statement is the false?

Use the following figure to answer the question : -If demand is elastic and price is lowered, total revenue will

The demand for goods such as telephone service and medical care tend to be

Use the following figure to answer the question : -In the graph above

If a decrease in price leads to a decrease in total revenue,

If a 1% change in price leads to a 2% change in quantity demanded, then the elasticity of demand is

Which product will have the most elastic demand curve?

Use the following Figure to answer the question : -About how much of the tax is paid by cigarette sellers?

Use the following Figure to answer the question : -How much revenue will the government raise from the tax?

A Brief Economic History of the United States

Resource Utilization

The Mixed Economy

Supply and Demand

Demand, Supply, and Equilibrium

Theory of Consumer Behavior

Cost

Profit, Loss, and Perfect Competition

Monopoly

Monopolistic Competition

Oligopoly

Corporate Mergers and Antitrust

Demand in the Factor Market

Labor Unions

Labor Markets and Wage Rates

Rent, Interest, and Profit

Income Distribution and Poverty

International Trade

International Finance

Filters

The elasticity of a perfectly horizontal line is ___; the elasticity of a perfectly vertical line is .