Question 1

Does the fact that the price elasticity of demand for a good is inelastic violate the law of demand?

Accepted Answer

No,if the demand is inelastic,when the p

Question 2

If the price of a one good increases and the quantity demanded of a different good decreases,then these two goods are

Accepted Answer

A)  substitutes. 
B)  normal goods. 
C)  inferior goods. 
D)  inelastic goods. 
E)  complements. 
A)  substitutes. 
B)  normal goods. 
C)  inferior goods. 
D)  inelastic goods. 
E)  complements.

Question 3

Consider two goods: peanut butter and jelly.If the price of jelly increases from $2 a jar to $3 per jar and the quantity demanded of peanut butter decreases from 50 jars to 45 jars,what is the cross elasticity of demand? Are the goods substitutes or complements?

Accepted Answer

The cross elasticity

Question 4

The figure above shows the demand curve for Starbucks latte.
-In the figure above,the demand is elastic in the range of prices between

Accepted Answer

A)  $3.50 and $4.50 per cup. 
B)  $2.50 and $3.50 per cup. 
C)  $1.00 and $2.00 per cup. 
D)  $2.00 and $4.00 per cup. 
E)  $1.75 and $2.75 per cup. 
A)  $3.50 and $4.50 per cup. 
B)  $2.50 and $3.50 per cup. 
C)  $1.00 and $2.00 per cup. 
D)  $2.00 and $4.00 per cup. 
E)  $1.75 and $2.75 per cup.

Question 5

Pizza Hut lowers the price of its pizza.The price elasticity of demand for Pizza Hut pizza equals 0.3.What happens to the Pizza Hut's total revenue?

Accepted Answer

A)  nothing 
B)  It increases. 
C)  It decreases. 
D)  It becomes negative. 
E)  It might change, but more information is needed to determine if it increases, decreases, or does not change. 
A)  nothing 
B)  It increases. 
C)  It decreases. 
D)  It becomes negative. 
E)  It might change, but more information is needed to determine if it increases, decreases, or does not change.

Question 6

When income increases by 6 percent,the demand for potatoes decreases by 2 percent.The income elasticity of demand for potatoes equals

Accepted Answer

A)  -2.00. 
B)  3.00. 
C)  -3.00. 
D)  0.33. 
E)  -0.33. 
A)  -2.00. 
B)  3.00. 
C)  -3.00. 
D)  0.33. 
E)  -0.33.

Question 7

Suppose bad weather decreases the quantity of wheat by 12 percent.If the price elasticity of demand for wheat is 0.6,how would the crop failure affect the price of wheat? Would the crop decrease benefit or harm wheat farmers?

Accepted Answer

When the price elasticity of demand is 0

Question 8

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

Accepted Answer

Between A and B,the elasticity

Question 9

Pete feeds his dog 100 percent more Pup-Peronis when Zuke's treats increase in price by 50 percent.For Pete,Pup-Peronis and Zuke's are ________ and the cross-price elasticity of demand is ________.

Accepted Answer

A)  complements; -1/2 
B)  substitutes; 2 
C)  substitutes; -2 
D)  complements; 2 
E)  substitutes; 1/2 
A)  complements; -1/2 
B)  substitutes; 2 
C)  substitutes; -2 
D)  complements; 2 
E)  substitutes; 1/2

Question 10

You are the brand manager of Crest toothpaste and you observe that when you increase the price of Crest,your total revenue increases.How is that possible?

Accepted Answer

The demand for Crest toothpast

Question 11

The price of the good multiplied by the quantity sold is its

Accepted Answer

A)  total revenue. 
B)  total cost. 
C)  total spending. 
D)  total income. 
E)  total quantity. 
A)  total revenue. 
B)  total cost. 
C)  total spending. 
D)  total income. 
E)  total quantity.

Question 12

-Using the table above,the elasticity of demand is equal to 1 at a price of

Accepted Answer

A)  $8. 
B)  $6. 
C)  $5. 
D)  $3. 
E)  $1. 
A)  $8. 
B)  $6. 
C)  $5. 
D)  $3. 
E)  $1.

Question 13

If Pepsi goes on sale and decreases its price by 10 percent,and as a result,the quantity demanded of Coca Cola decreases by 5 percent,then Pepsi and Coke are ________ goods.

Accepted Answer

A)  inferior 
B)  normal 
C)  substitute 
D)  complementary 
E)  unrelated 
A)  inferior 
B)  normal 
C)  substitute 
D)  complementary 
E)  unrelated

Question 14

If the income elasticity of demand for a Miami Dolphin season ticket is 2.34,then are Dolphin season tickets a normal or an inferior good?

Accepted Answer

Because the income e

Question 15

When the price of a textbook is $95,the quantity of textbooks supplied is 90 million a year and when the price rises to $105,the quantity of textbooks supplied is 110 million a year.The supply of textbooks is

Accepted Answer

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

Question 16

If a good is a necessity,it has ________ substitutes and its demand is ________.

Accepted Answer

A)  poor; elastic 
B)  poor; inelastic 
C)  many; elastic 
D)  many; inelastic 
E)  many; precisely unit elastic 
A)  poor; elastic 
B)  poor; inelastic 
C)  many; elastic 
D)  many; inelastic 
E)  many; precisely unit elastic

Question 17

The total revenue test says that if a price decrease leads to

Accepted Answer

A)  an increase in total revenue, supply is elastic. 
B)  a decrease in total revenue, supply is unit elastic. 
C)  a decrease in total revenue, supply is inelastic. 
D)  an increase in total revenue, supply is inelastic. 
E)  None of the above answers is correct. 
A)  an increase in total revenue, supply is elastic. 
B)  a decrease in total revenue, supply is unit elastic. 
C)  a decrease in total revenue, supply is inelastic. 
D)  an increase in total revenue, supply is inelastic. 
E)  None of the above answers is correct.

Question 18

The longer the time that has elapsed since the price of a good changed,the

Accepted Answer

A)  more elastic the demand for that good. 
B)  steeper the demand curve. 
C)  less elastic the demand for that good. 
D)  smaller the amount of that good bought. 
E)  fewer substitutes available for the good. 
A)  more elastic the demand for that good. 
B)  steeper the demand curve. 
C)  less elastic the demand for that good. 
D)  smaller the amount of that good bought. 
E)  fewer substitutes available for the good.

Question 19

If the price elasticity of demand for razors is 0.32,the demand for razors is

Accepted Answer

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

Question 20

The income elasticity of demand is ________ if the good is ________ good.

Accepted Answer

A)  positive; a normal 
B)  positive; an inferior 
C)  negative; a normal 
D)  less than one; an inferior 
E)  positive; a substitute 
A)  positive; a normal 
B)  positive; an inferior 
C)  negative; a normal 
D)  less than one; an inferior 
E)  positive; a substitute

Does the fact that the price elasticity of demand for a good is inelastic violate the law of demand?

If the price of a one good increases and the quantity demanded of a different good decreases,then these two goods are

Consider two goods: peanut butter and jelly.If the price of jelly increases from $2 a jar to $3 per jar and the quantity demanded of peanut butter decreases from 50 jars to 45 jars,what is the cross elasticity of demand? Are the goods substitutes or complements?

The figure above shows the demand curve for Starbucks latte. -In the figure above,the demand is elastic in the range of prices between

Pizza Hut lowers the price of its pizza.The price elasticity of demand for Pizza Hut pizza equals 0.3.What happens to the Pizza Hut's total revenue?

When income increases by 6 percent,the demand for potatoes decreases by 2 percent.The income elasticity of demand for potatoes equals

Suppose bad weather decreases the quantity of wheat by 12 percent.If the price elasticity of demand for wheat is 0.6,how would the crop failure affect the price of wheat? Would the crop decrease benefit or harm wheat farmers?

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

Pete feeds his dog 100 percent more Pup-Peronis when Zuke's treats increase in price by 50 percent.For Pete,Pup-Peronis and Zuke's are and the cross-price elasticity of demand is .

You are the brand manager of Crest toothpaste and you observe that when you increase the price of Crest,your total revenue increases.How is that possible?

The price of the good multiplied by the quantity sold is its

-Using the table above,the elasticity of demand is equal to 1 at a price of

If Pepsi goes on sale and decreases its price by 10 percent,and as a result,the quantity demanded of Coca Cola decreases by 5 percent,then Pepsi and Coke are ________ goods.

If the income elasticity of demand for a Miami Dolphin season ticket is 2.34,then are Dolphin season tickets a normal or an inferior good?

When the price of a textbook is $95,the quantity of textbooks supplied is 90 million a year and when the price rises to $105,the quantity of textbooks supplied is 110 million a year.The supply of textbooks is

If a good is a necessity,it has substitutes and its demand is .

The total revenue test says that if a price decrease leads to

The longer the time that has elapsed since the price of a good changed,the

If the price elasticity of demand for razors is 0.32,the demand for razors is

The income elasticity of demand is if the good is good.

Getting Started

The U.S.and Global Economies

The Economic Problem

Demand and Supply

Efficiency and Fairness of Markets

Government Actions in Markets

Taxes

Global Markets in Action

Externalities

Public Goods and Common Resources

Markets with Private Information

Consumer Choice and Demand

Production and Cost

Perfect Competition

Monopoly

Monopolistic Competition

Oligopoly

Markets for Factors of Production

Economic Inequality

Filters

Exam 5: Elasticities of Demand and Supply

Does the fact that the price elasticity of demand for a good is inelastic violate the law of demand?

If the price of a one good increases and the quantity demanded of a different good decreases,then these two goods are

Consider two goods: peanut butter and jelly.If the price of jelly increases from $2 a jar to $3 per jar and the quantity demanded of peanut butter decreases from 50 jars to 45 jars,what is the cross elasticity of demand? Are the goods substitutes or complements?

The figure above shows the demand curve for Starbucks latte. -In the figure above,the demand is elastic in the range of prices between

Pizza Hut lowers the price of its pizza.The price elasticity of demand for Pizza Hut pizza equals 0.3.What happens to the Pizza Hut's total revenue?

When income increases by 6 percent,the demand for potatoes decreases by 2 percent.The income elasticity of demand for potatoes equals

Suppose bad weather decreases the quantity of wheat by 12 percent.If the price elasticity of demand for wheat is 0.6,how would the crop failure affect the price of wheat? Would the crop decrease benefit or harm wheat farmers?

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

Pete feeds his dog 100 percent more Pup-Peronis when Zuke's treats increase in price by 50 percent.For Pete,Pup-Peronis and Zuke's are ________ and the cross-price elasticity of demand is ________.

You are the brand manager of Crest toothpaste and you observe that when you increase the price of Crest,your total revenue increases.How is that possible?

The price of the good multiplied by the quantity sold is its

-Using the table above,the elasticity of demand is equal to 1 at a price of

If Pepsi goes on sale and decreases its price by 10 percent,and as a result,the quantity demanded of Coca Cola decreases by 5 percent,then Pepsi and Coke are ________ goods.

If the income elasticity of demand for a Miami Dolphin season ticket is 2.34,then are Dolphin season tickets a normal or an inferior good?

When the price of a textbook is $95,the quantity of textbooks supplied is 90 million a year and when the price rises to $105,the quantity of textbooks supplied is 110 million a year.The supply of textbooks is

If a good is a necessity,it has ________ substitutes and its demand is ________.

The total revenue test says that if a price decrease leads to

The longer the time that has elapsed since the price of a good changed,the

If the price elasticity of demand for razors is 0.32,the demand for razors is

The income elasticity of demand is ________ if the good is ________ good.

Getting Started

The U.S.and Global Economies

The Economic Problem

Demand and Supply

Efficiency and Fairness of Markets

Government Actions in Markets

Taxes

Global Markets in Action

Externalities

Public Goods and Common Resources

Markets with Private Information

Consumer Choice and Demand

Production and Cost

Perfect Competition

Monopoly

Monopolistic Competition

Oligopoly

Markets for Factors of Production

Economic Inequality

Filters

Pete feeds his dog 100 percent more Pup-Peronis when Zuke's treats increase in price by 50 percent.For Pete,Pup-Peronis and Zuke's are and the cross-price elasticity of demand is .

If a good is a necessity,it has substitutes and its demand is .

The income elasticity of demand is if the good is good.