Exam 19: Demand and Supply Elasticity

When the price of sausages is $2.00 per pound, consumers buy 50 pounds of fish. When the price of sausages rises to $3.00 per pound, 60 pounds of fish are purchased. The cross price elasticity of demand between sausages and fish is approximately equal to

If the absolute price elasticity of demand for a product is less than 1, then

-Use the above figure. Which graph depicts a normal good?

When demand is elastic

Suppose the price of A increases by 10 percent while the quantity demanded of B does NOT change. We would conclude that

Usually, price elasticities of supply are

George always purchases the soda with the lowest price. For George, the cross price elasticity of demand for two brands of soda will be

The price of A falls by 2 percent, and the quantity demanded of A increases by 2 percent. Meanwhile, the quantity demanded of B increases by 2 percent too. We would conclude that

The cross price elasticity of demand is measured by the

Which of the following statements about demand and price elasticity of demand is TRUE?

If the demand curve for a product is vertical, then

Suppose that the value of the short-run absolute elasticity of demand for a good is 0.4. Then, we know the long-run absolute price elasticity of demand will be

-Refer to the above table. What is the absolute price elasticity of demand when a price rises from $8 to $8.50?

A decrease in total revenue will result if

At a price of $10, quantity demanded is 30 units. When the price rises to $11, quantity demanded is 24 units. What is the absolute price elasticity of demand?

The price elasticity of demand is the

When the price of a video rental was $2.00, ticket sales at the local movie theatre averaged 180 admissions per night. Then the video store reduced the price of a video rental to $1, and the theatre manager reported that ticket sales had fallen to 126 per night. What is the approximate value of the cross price elasticity of demand between video rentals and theatre tickets?

If an individual's income rises 4 percent and his clothing purchases increase 5 percent in response, the income elasticity for clothing by the individual is

Suppose that the price of eggs increases from 75 cents to $1.00 per dozen and as a result a typical farmer experiences a decrease in egg sales from 300 to 200 dozen per week. Using the method of average values, the absolute price elasticity of demand is

The actual value of price elasticity of demand