Question 1

Most goods are normal goods, and their demand shifts to the left when income rises.

Accepted Answer

A) True 
 B)False

Question 2

Elasticity of supply tells us

Accepted Answer

A) How much sellers will increase production in response to a change in price. 
B) How much sellers will change their price as their quantity supplied changes. 
C) How much producers will increase production with changes in consumers'income. 
D) How much supply responds to a change in quantity demanded. 
A) How much sellers will increase production in response to a change in price. 
B) How much sellers will change their price as their quantity supplied changes. 
C) How much producers will increase production with changes in consumers'income. 
D) How much supply responds to a change in quantity demanded.

Question 3

The World View article on the rise in gold prices indicates that

Accepted Answer

A) The quantity supplied falls when the price of gold rises. 
B) The law of supply is true: as the price of gold rises, miners around the world search for new deposits of gold. 
C) The law of supply is true because as the price of gold rises, the quantity supplied of gold actually falls. 
D) The law of supply is not really relevant to the article. 
A) The quantity supplied falls when the price of gold rises. 
B) The law of supply is true: as the price of gold rises, miners around the world search for new deposits of gold. 
C) The law of supply is true because as the price of gold rises, the quantity supplied of gold actually falls. 
D) The law of supply is not really relevant to the article.

Question 4

You own your business, and your research indicates that the price elasticity of demand for your product is 3.5.What pricing strategies should you follow, and why?

Accepted Answer

Price elasticity is the percentage chang

Question 5

The price elasticity number for necessities will be greater than 1.

Accepted Answer

A) True 
 B)False

Question 6

To find the average percentage change in quantity demanded,

Accepted Answer

A) The change in price is divided by the percentage change in quantity demanded. 
B) The change in quantity demanded is divided by the change in price. 
C) The change in quantity demanded is divided by the average quantity. 
D) The change in price is divided by the average price. 
A) The change in price is divided by the percentage change in quantity demanded. 
B) The change in quantity demanded is divided by the change in price. 
C) The change in quantity demanded is divided by the average quantity. 
D) The change in price is divided by the average price.

Question 7

If the cross-price elasticity of demand for SUVs with respect to the price of gasoline is -0.10, and gasoline prices rise by 18 percent, then SUV sales should, ceteris paribus,

Accepted Answer

A) Fall by 1.8 percent. 
B) Fall by 18 percent. 
C) Rise by 1.8 percent. 
D) Rise by 18 percent. 
A) Fall by 1.8 percent. 
B) Fall by 18 percent. 
C) Rise by 1.8 percent. 
D) Rise by 18 percent.

Most goods are normal goods, and their demand shifts to the left when income rises.

Elasticity of supply tells us

The World View article on the rise in gold prices indicates that

You own your business, and your research indicates that the price elasticity of demand for your product is 3.5.What pricing strategies should you follow, and why?

The price elasticity number for necessities will be greater than 1.

To find the average percentage change in quantity demanded,

If the cross-price elasticity of demand for SUVs with respect to the price of gasoline is -0.10, and gasoline prices rise by 18 percent, then SUV sales should, ceteris paribus,

Economics: the Core Issues

The Useconomy: a Global View

Supply and Demand

The Role of Government

Consumer Choice

The Costs of Production

The Competitive Firm

Competitive Markets

Monopoly

Oligopoly

Monopolistic Competition

Natural Monopolies: Deregulation

Environmental Protection

The Farm Problem

The Labor Market

Labor Unions

Financial Markets

Taxes: Equity Versus Efficiency

Transfer Payments: Welfare and Social Security

International Trade

International Finance

Global Poverty

Filters

Exam 6: Elasticity

Most goods are normal goods, and their demand shifts to the left when income rises.

Elasticity of supply tells us

The World View article on the rise in gold prices indicates that

You own your business, and your research indicates that the price elasticity of demand for your product is 3.5.What pricing strategies should you follow, and why?

The price elasticity number for necessities will be greater than 1.

To find the average percentage change in quantity demanded,

If the cross-price elasticity of demand for SUVs with respect to the price of gasoline is -0.10, and gasoline prices rise by 18 percent, then SUV sales should, ceteris paribus,

Economics: the Core Issues

The Useconomy: a Global View

Supply and Demand

The Role of Government

Consumer Choice

The Costs of Production

The Competitive Firm

Competitive Markets

Monopoly

Oligopoly

Monopolistic Competition

Natural Monopolies: Deregulation

Environmental Protection

The Farm Problem

The Labor Market

Labor Unions

Financial Markets

Taxes: Equity Versus Efficiency

Transfer Payments: Welfare and Social Security

International Trade

International Finance

Global Poverty

Filters