Question 1

Which statement is true?

Accepted Answer

A) Over time demand tends to become less elastic. 
B) The demand for cigarettes is very elastic. 
C) Advertisers try to make the demand for their products less elastic. 
D) None of these statements are true. 
A) Over time demand tends to become less elastic. 
B) The demand for cigarettes is very elastic. 
C) Advertisers try to make the demand for their products less elastic. 
D) None of these statements are true.

Question 2

The seller will bear the entire burden of a tax in all of the following except

Accepted Answer

A) when the demand is perfectly elastic. 
B) when the supply is perfectly inelastic. 
C) when the supply curve is a vertical line. 
D) when the demand curve is a vertical line. 
A) when the demand is perfectly elastic. 
B) when the supply is perfectly inelastic. 
C) when the supply curve is a vertical line. 
D) when the demand curve is a vertical line.

Question 3

Use the following figure to answer the question :  
-A perfectly inelastic supply curve is

Accepted Answer

A) horizontal. 
B) vertical. 
C) positively sloped. 
D) negatively sloped. 
A) horizontal. 
B) vertical. 
C) positively sloped. 
D) negatively sloped.

Question 4

If elasticity of demand is 1.0 and price is lowered from $100 to $99, by what percentage will quantity demanded rise?

Accepted Answer

The answer of If elasticity of demand is 1.0 and...

Question 5

If the price elasticity of demand is zero for all prices, the demand curve is

Accepted Answer

A) horizontal. 
B) vertical. 
C) neither horizontal nor vertical. 
A) horizontal. 
B) vertical. 
C) neither horizontal nor vertical.

Question 6

Statement I: A perfectly elastic demand curve has the same elasticity as a perfectly inelastic demand curve. Statement II: When elasticity is .2, a 1% decline in price will raise quantity demanded by .2%.

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 7

The elasticity closest to unit elastic would be

Accepted Answer

A) 0. 
B) 0.2. 
C) 1.4. 
D) 5. 
E) 10. 
A) 0. 
B) 0.2. 
C) 1.4. 
D) 5. 
E) 10.

Question 8

If price were lowered from $10 to $8 and quantity demanded rose from 50 to 51, calculate elasticity; state whether demand is elastic, unit elastic, or inelastic; and find how much total revenue was when price was $10 and $8.

Accepted Answer

P1 = 10; P

Question 9

If income elasticity for a good or service is ______, then we can say that the good or service is _____.

Accepted Answer

A) negative; inferior 
B) negative; normal 
C) positive; inferior 
D) zero; normal 
A) negative; inferior 
B) negative; normal 
C) positive; inferior 
D) zero; normal

Question 10

If demand for a service is very elastic, make up a number to represent its elasticity. _____

Accepted Answer

10 (or any

Question 11

Which of the following characteristics would describe a product with an inelastic 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 12

Which of these has the most elastic demand?

Accepted Answer

A) Filet Mignon steak 
B) Bread 
C) Heart medicine 
D) Insulin (diabetes medicine) 
A) Filet Mignon steak 
B) Bread 
C) Heart medicine 
D) Insulin (diabetes medicine)

Question 13

The seller passes on the entire tax to the consumer when demand is ____.

Accepted Answer

The answer of The seller passes on the entire tax...

Question 14

Which statement is true?

Accepted Answer

A) The supply curve in the market period is always perfectly inelastic. 
B) The supply curve for a perishable good, such as ripe strawberries, is perfectly elastic. 
C) Business firms cannot respond to increases in demand for their product in the short run. 
D) The long-run supply curve is more elastic than the short-run supply curve. 
A) The supply curve in the market period is always perfectly inelastic. 
B) The supply curve for a perishable good, such as ripe strawberries, is perfectly elastic. 
C) Business firms cannot respond to increases in demand for their product in the short run. 
D) The long-run supply curve is more elastic than the short-run supply curve.

Question 15

Assume the Cookie Monster, who eats only cookies, has an income of $200 a week and that the price of a cookie is $2. If the price doubles, he cuts his consumption in half. How much is his elasticity of demand for cookies?

Accepted Answer

The answer of Assume the Cookie Monster, who eats only...

Question 16

When demand is perfectly elastic the entire tax burden falls on the ____.

Accepted Answer

The answer of When demand is perfectly elastic the entire...

Question 17

Which of these has the least elastic demand?

Accepted Answer

A) Chicken 
B) Insulin (diabetes medicine) 
C) Levi's jeans 
D) Honda Civics 
A) Chicken 
B) Insulin (diabetes medicine) 
C) Levi's jeans 
D) Honda Civics

Question 18

If elasticity of demand is 10, a 1% increase in price will lower quantity demanded by

Accepted Answer

A) .1%. 
B) 1%. 
C) 10%. 
D) 100%. 
A) .1%. 
B) 1%. 
C) 10%. 
D) 100%.

Question 19

When the cross elasticity of demand for two services is positive, then these services are _________.

Accepted Answer

A) complements 
B) substitutes 
C) both complements and substitutes 
D) neither complements nor substitutes 
A) complements 
B) substitutes 
C) both complements and substitutes 
D) neither complements nor substitutes

Question 20

If the federal excise tax on cigarettes were raised by one dollar, the price of cigarettes would probably

Accepted Answer

A) rise by more than one dollar. 
B) rise by one dollar. 
C) rise by less than one dollar. 
D) not rise at all. 
A) rise by more than one dollar. 
B) rise by one dollar. 
C) rise by less than one dollar. 
D) not rise at all.

Which statement is true?

The seller will bear the entire burden of a tax in all of the following except

Use the following figure to answer the question : -A perfectly inelastic supply curve is

If elasticity of demand is 1.0 and price is lowered from $100 to $99, by what percentage will quantity demanded rise?

If the price elasticity of demand is zero for all prices, the demand curve is

Statement I: A perfectly elastic demand curve has the same elasticity as a perfectly inelastic demand curve. Statement II: When elasticity is .2, a 1% decline in price will raise quantity demanded by .2%.

The elasticity closest to unit elastic would be

If price were lowered from $10 to $8 and quantity demanded rose from 50 to 51, calculate elasticity; state whether demand is elastic, unit elastic, or inelastic; and find how much total revenue was when price was $10 and $8.

If income elasticity for a good or service is __, then we can say that the good or service is _.

If demand for a service is very elastic, make up a number to represent its elasticity. _____

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

Which of these has the most elastic demand?

The seller passes on the entire tax to the consumer when demand is ____.

Which statement is true?

Assume the Cookie Monster, who eats only cookies, has an income of $200 a week and that the price of a cookie is $2. If the price doubles, he cuts his consumption in half. How much is his elasticity of demand for cookies?

When demand is perfectly elastic the entire tax burden falls on the ____.

Which of these has the least elastic demand?

If elasticity of demand is 10, a 1% increase in price will lower quantity demanded by

When the cross elasticity of demand for two services is positive, then these services are _________.

If the federal excise tax on cigarettes were raised by one dollar, the price of cigarettes would probably

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 statement is true?

The seller will bear the entire burden of a tax in all of the following except

Use the following figure to answer the question : -A perfectly inelastic supply curve is

If elasticity of demand is 1.0 and price is lowered from $100 to $99, by what percentage will quantity demanded rise?

If the price elasticity of demand is zero for all prices, the demand curve is

Statement I: A perfectly elastic demand curve has the same elasticity as a perfectly inelastic demand curve. Statement II: When elasticity is .2, a 1% decline in price will raise quantity demanded by .2%.

The elasticity closest to unit elastic would be

If price were lowered from $10 to $8 and quantity demanded rose from 50 to 51, calculate elasticity; state whether demand is elastic, unit elastic, or inelastic; and find how much total revenue was when price was $10 and $8.

If income elasticity for a good or service is ______, then we can say that the good or service is _____.

If demand for a service is very elastic, make up a number to represent its elasticity. _____

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

Which of these has the most elastic demand?

The seller passes on the entire tax to the consumer when demand is ____.

Which statement is true?

Assume the Cookie Monster, who eats only cookies, has an income of $200 a week and that the price of a cookie is $2. If the price doubles, he cuts his consumption in half. How much is his elasticity of demand for cookies?

When demand is perfectly elastic the entire tax burden falls on the ____.

Which of these has the least elastic demand?

If elasticity of demand is 10, a 1% increase in price will lower quantity demanded by

When the cross elasticity of demand for two services is positive, then these services are _________.

If the federal excise tax on cigarettes were raised by one dollar, the price of cigarettes would probably

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

If income elasticity for a good or service is __, then we can say that the good or service is _.