Exam 5: Elasticities of Demand and Supply

In the mid-1970s,Newsweek magazine reported that the city of Atlanta lowered its city bus fares from 40 cents to 15 cents a passenger.The number of bus riders increased by 15 percent after the fare cut.This set of results indicates that the demand for bus rides in Atlanta at that time was

In the figure above,when the price falls from $5 to $4,the price elasticity of demand is

-The table above gives the demand schedule for a good.Using the midpoint method,find the price elasticity of demand between points A and B,between B and C,between C and D,and between D and E.

The price of one bedroom apartments in Cheyenne increased from $55,000 to $65,000 and the quantity of apartment for sale increased from 25 to 30.Using the midpoint method,the price elasticity of supply for apartments in Cheyenne is equal to

Supply is unit elastic when the

-The data in the table above give two points on the demand curve for pizza.Using the midpoint method,when the price of a pizza falls from $10 to $9,what is the percentage change in the quantity demanded?

People eat at restaurants less often when their incomes fall because of a recession.Eating at restaurants must be

When a firm raises the price of its product,what happens to its total revenue?

The income elasticity of demand for store brands of soda (that is,non-name brands)is negative.What does this fact indicate about consumers' perceptions about the store brands?

If the price elasticity of supply for a good is 10,then supply is

-The fact that there is a very limited amount of land in Hong Kong means the supply of new apartments in Hong Kong is

If substitutes for a good are readily available,the demand for that good

If the price of a movie rises 3 percent and,as a result,the quantity demanded of video rentals increases 6 percent,then the cross elasticity of demand is

Suppose a local photographer increases his prices by 8 percent and quantity demanded decreases by the same percentage.This set of facts indicates that the demand for his services is

Explain why the number of substitutes influences the price elasticity of demand.

Goods are ________ when the income elasticity of demand is positive.

If the price of a product increases by 5 percent and the quantity demanded decreases by 5 percent,then the elasticity of demand is

Suppose the price elasticity of demand for bouquets of flowers is 4.0.You are charging $8 per bouquet.If you want to increase the quantity of bouquets you sell by 20 percent,what price should you charge?

-In the figure above,what is the total revenue at point A?

-Based on the data in the table above,ice cream and cake are ________ goods.