Question 1

Which product will have the most inelastic demand curve?

Accepted Answer

A) Beer 
B) Motor vehicles 
C) Milk 
D) Household electricity 
A) Beer 
B) Motor vehicles 
C) Milk 
D) Household electricity

Question 2

Use the following Figure to answer the question :  
-Statement I: A perfectly inelastic supply curve and a perfectly inelastic demand curve are represented the same way on a graph. Statement II: A tax increase will increase supply.

Accepted Answer

A) Statement I is true and statement II is false. 
B) Statement II is true and statement I is false. 
C) Both statements are true. 
D) Both statements are false. 
A) Statement I is true and statement II is false. 
B) Statement II is true and statement I is false. 
C) Both statements are true. 
D) Both statements are false.

Question 3

Which of the following has the highest elasticity of demand?

Accepted Answer

A) Medical care 
B) Telephone services 
C) Bread 
D) Household electricity 
E) Restaurant meals 
A) Medical care 
B) Telephone services 
C) Bread 
D) Household electricity 
E) Restaurant meals

Question 4

Use the following Figure to answer the question :  
-In general, the more unique an advertiser can make a product seem to the buyer

Accepted Answer

A) the more elastic the demand for the good. 
B) the more inelastic the demand for the good. 
C) the more sensitive the buyer is to the price of the good. 
D) the less demand for the good. 
A) the more elastic the demand for the good. 
B) the more inelastic the demand for the good. 
C) the more sensitive the buyer is to the price of the good. 
D) the less demand for the good.

Question 5

Income elasticity of demand measures how ___________________.

Accepted Answer

A) responsive the quantity of one good demanded to a change in the price of another good 
B) the consumption of various goods and services respond to change in income 
C) the quantity demanded responds to a change in price 
D) responsive the quantity supplied is to a change in price 
A) responsive the quantity of one good demanded to a change in the price of another good 
B) the consumption of various goods and services respond to change in income 
C) the quantity demanded responds to a change in price 
D) responsive the quantity supplied is to a change in price

Question 6

A 15% decrease in the price of sugar causes the quantity demanded to rise by 5%. The demand for sugar is

Accepted Answer

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

Question 7

If elasticity of demand is 10 and price is raised from $100 to $102, by what percentage will quantity demanded fall?

Accepted Answer

The answer of If elasticity of demand is 10 and...

Question 8

If the elasticity of demand for a service is 1, then the demand for that service is

Accepted Answer

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

Question 9

A tax increase _________ supply.

Accepted Answer

The answer of A tax increase _________ supply....

Question 10

If the price were increased from $94 to $96 and quantity demanded fell from 38 to 37, calculate elasticity; state whether demand is elastic, unit elastic, or inelastic, and find how much total revenue was when the price was $94 and $96.

Accepted Answer

P1 = $94;

Question 11

If supply is more elastic than demand, the seller will pay _____ of a tax.

Accepted Answer

The answer of If supply is more elastic than demand,...

Question 12

If demand and supply have the same elasticity, the buyer will pay _____ of a tax.

Accepted Answer

The answer of If demand and supply have the same...

Question 13

The more time a buyer has to purchase a product, the more ________ the buyer can find and, therefore, the more _________ the good becomes.

Accepted Answer

substitute

Question 14

In the market period, a steel manufacturer has a __________ productive capacity.

Accepted Answer

The answer of In the market period, a steel manufacturer...

Question 15

Ideally, an ad will make a buyer feel that she ______ have the product. In other words, the ad makes the good more ________.

Accepted Answer

The answer of Ideally, an ad will make a buyer...

Question 16

Use the following Figure to answer the question :  
-About how much of the tax is paid by consumers in the form of higher prices?

Accepted Answer

A) $1.00 
B) $1.35 
C) $1.65 
D) $2.00 
E) $4.00 
A) $1.00 
B) $1.35 
C) $1.65 
D) $2.00 
E) $4.00

Question 17

When supply is more elastic than demand, the buyer pays _____ of a tax.

Accepted Answer

A) all 
B) most 
C) half 
D) less than half 
E) none 
A) all 
B) most 
C) half 
D) less than half 
E) none

Question 18

The imposition of a sales tax on jewelry would result in

Accepted Answer

A) an increase in demand for jewelry. 
B) an increase in the quantity demanded for jewelry. 
C) a reduction in the demand for jewelry. 
D) a reduction in the quantity of jewelry demanded. 
E) a reduction of jewelry demanded and a reduction in the demand for jewelry. 
A) an increase in demand for jewelry. 
B) an increase in the quantity demanded for jewelry. 
C) a reduction in the demand for jewelry. 
D) a reduction in the quantity of jewelry demanded. 
E) a reduction of jewelry demanded and a reduction in the demand for jewelry.

Question 19

Which of the following characteristics would describe a product with an elastic demand?

Accepted Answer

A) The good is considered a necessity and many substitutes for the product exist. 
B) The good is considered a necessity and few substitutes for the product exist. 
C) The good is considered a luxury and many substitutes for the product exist. 
D) The good is considered a luxury and few substitutes for the product exist. 
A) The good is considered a necessity and many substitutes for the product exist. 
B) The good is considered a necessity and few substitutes for the product exist. 
C) The good is considered a luxury and many substitutes for the product exist. 
D) The good is considered a luxury and few substitutes for the product exist.

Question 20

Since the cross elasticity of demand between hamburger patties and cheese is negative, these are ________ goods.

Accepted Answer

A) complementary 
B) substitutable 
C) normal 
D) both complementary and substitutable 
A) complementary 
B) substitutable 
C) normal 
D) both complementary and substitutable

Which product will have the most inelastic demand curve?

Use the following Figure to answer the question : -Statement I: A perfectly inelastic supply curve and a perfectly inelastic demand curve are represented the same way on a graph. Statement II: A tax increase will increase supply.

Which of the following has the highest elasticity of demand?

Use the following Figure to answer the question : -In general, the more unique an advertiser can make a product seem to the buyer

Income elasticity of demand measures how ___________________.

A 15% decrease in the price of sugar causes the quantity demanded to rise by 5%. The demand for sugar is

If elasticity of demand is 10 and price is raised from $100 to $102, by what percentage will quantity demanded fall?

If the elasticity of demand for a service is 1, then the demand for that service is

A tax increase _________ supply.

If the price were increased from $94 to $96 and quantity demanded fell from 38 to 37, calculate elasticity; state whether demand is elastic, unit elastic, or inelastic, and find how much total revenue was when the price was $94 and $96.

If supply is more elastic than demand, the seller will pay _____ of a tax.

If demand and supply have the same elasticity, the buyer will pay _____ of a tax.

The more time a buyer has to purchase a product, the more the buyer can find and, therefore, the more _ the good becomes.

In the market period, a steel manufacturer has a __________ productive capacity.

Ideally, an ad will make a buyer feel that she have the product. In other words, the ad makes the good more __.

Use the following Figure to answer the question : -About how much of the tax is paid by consumers in the form of higher prices?

When supply is more elastic than demand, the buyer pays _____ of a tax.

The imposition of a sales tax on jewelry would result in

Which of the following characteristics would describe a product with an elastic demand?

Since the cross elasticity of demand between hamburger patties and cheese is negative, these are ________ goods.

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

Which product will have the most inelastic demand curve?

Use the following Figure to answer the question : -Statement I: A perfectly inelastic supply curve and a perfectly inelastic demand curve are represented the same way on a graph. Statement II: A tax increase will increase supply.

Which of the following has the highest elasticity of demand?

Use the following Figure to answer the question : -In general, the more unique an advertiser can make a product seem to the buyer

Income elasticity of demand measures how ___________________.

A 15% decrease in the price of sugar causes the quantity demanded to rise by 5%. The demand for sugar is

If elasticity of demand is 10 and price is raised from $100 to $102, by what percentage will quantity demanded fall?

If the elasticity of demand for a service is 1, then the demand for that service is

A tax increase _________ supply.

If the price were increased from $94 to $96 and quantity demanded fell from 38 to 37, calculate elasticity; state whether demand is elastic, unit elastic, or inelastic, and find how much total revenue was when the price was $94 and $96.

If supply is more elastic than demand, the seller will pay _____ of a tax.

If demand and supply have the same elasticity, the buyer will pay _____ of a tax.

The more time a buyer has to purchase a product, the more ________ the buyer can find and, therefore, the more _________ the good becomes.

In the market period, a steel manufacturer has a __________ productive capacity.

Ideally, an ad will make a buyer feel that she ______ have the product. In other words, the ad makes the good more ________.

Use the following Figure to answer the question : -About how much of the tax is paid by consumers in the form of higher prices?

When supply is more elastic than demand, the buyer pays _____ of a tax.

The imposition of a sales tax on jewelry would result in

Which of the following characteristics would describe a product with an elastic demand?

Since the cross elasticity of demand between hamburger patties and cheese is negative, these are ________ goods.

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 more time a buyer has to purchase a product, the more the buyer can find and, therefore, the more _ the good becomes.

Ideally, an ad will make a buyer feel that she have the product. In other words, the ad makes the good more __.