Question 1

Refer to the following figure.The point elasticities of demand for D1,D2,and D3 at a price of $5 are ________,________,and _______,respectively.

Accepted Answer

A) -1.4; -0.2;-1.4 
B) -0.71; -5; -0.71 
C) -1.4; -0.2; -5 
D) -12; -6; -12 
E) -0.0833; -0.1667; -0.0833 
A) -1.4; -0.2;-1.4 
B) -0.71; -5; -0.71 
C) -1.4; -0.2; -5 
D) -12; -6; -12 
E) -0.0833; -0.1667; -0.0833

Question 2

According to the following figure,demand is unitary elastic at P = $________.

Accepted Answer

A) 5 
B) 10 
C) 15 
D) 20 
E) 25 
A) 5 
B) 10 
C) 15 
D) 20 
E) 25

Question 3

When marginal revenue is positive,

Accepted Answer

A) demand is elastic. 
B) marginal revenue is greater than price. 
C) decreasing price will decrease total revenue. 
D) both b and c 
E) all of the above 
A) demand is elastic. 
B) marginal revenue is greater than price. 
C) decreasing price will decrease total revenue. 
D) both b and c 
E) all of the above

Question 4

When demand is inelastic,

Accepted Answer

A) quantity sold does not increase when price decreases. 
B) selling one more unit of output causes marginal revenue to increase. 
C) selling one more unit of output cause total revenue to increase. 
D) buyers are not very responsive to changes in the price of the product. 
E) the percentage change in quantity demanded will exceed the percentage change in price in absolute value). 
A) quantity sold does not increase when price decreases. 
B) selling one more unit of output causes marginal revenue to increase. 
C) selling one more unit of output cause total revenue to increase. 
D) buyers are not very responsive to changes in the price of the product. 
E) the percentage change in quantity demanded will exceed the percentage change in price in absolute value).

Question 5

If the price elasticity of demand for a good is -0.8 and quantity demanded decreases by 40%,price must have

Accepted Answer

A) increased by 5%. 
B) increased by 32%. 
C) decreased by 20%. 
D) decreased by 32%. 
E) none of the above 
A) increased by 5%. 
B) increased by 32%. 
C) decreased by 20%. 
D) decreased by 32%. 
E) none of the above

Question 6

Interior Department recently announced that it will increase the entrance fees at Yellowstone National Park in order to increase park revenues.The Interior Department must believe that

Accepted Answer

A) park goers are very responsive to price changes. 
B) the demand for park services is elastic. 
C) the percentage increase in fees will be greater than the percentage decrease in the number of park visitors. 
D) demand is unitary elastic,and thus the number of visitors will NOT decrease. 
A) park goers are very responsive to price changes. 
B) the demand for park services is elastic. 
C) the percentage increase in fees will be greater than the percentage decrease in the number of park visitors. 
D) demand is unitary elastic,and thus the number of visitors will NOT decrease.

Question 7

Use the figure below,which shows a linear demand curve and the associated total revenue curve,to answer the question.   The price for which 100 units can be sold is $_____.

Accepted Answer

A) 10 
B) 15 
C) 25 
D) 45 
E) 50 
A) 10 
B) 15 
C) 25 
D) 45 
E) 50

Question 8

To answer the question,refer to the following table showing a demand schedule:   As quantity demanded rises from 1,400 to 1,800,what is marginal revenue?

Accepted Answer

A) $25 
B) $50 
C) -$400 
D) -$50 
E) -$75 
A) $25 
B) $50 
C) -$400 
D) -$50 
E) -$75

Question 9

Refer to the following graph to answer the question:   Suppose price rises from $90 to $110.Using representative arrows,the price effect is a relatively ________ short,long)arrow pointing _______ upward,downward).

Accepted Answer

A) short; upward 
B) short; downward 
C) long; upward 
D) long; downward 
A) short; upward 
B) short; downward 
C) long; upward 
D) long; downward

Question 10

To answer the question,refer to the following table showing a demand schedule:   If price falls from $150 to $100,

Accepted Answer

A) arrows representing the price and quantity effects both point down. 
B) an arrow representing the price effect points down and is shorter than an arrow for the quantity effect. 
C) total revenue moves in the same direction as the arrow representing the price effect. 
D) the arrow representing the price effect points down and the arrow representing the quantity effect points up. 
E) both c and d 
A) arrows representing the price and quantity effects both point down. 
B) an arrow representing the price effect points down and is shorter than an arrow for the quantity effect. 
C) total revenue moves in the same direction as the arrow representing the price effect. 
D) the arrow representing the price effect points down and the arrow representing the quantity effect points up. 
E) both c and d

Question 11

E1 is demand elasticity for Minute Maid orange juice,E2 is demand elasticity for all orange juice,and E3 is demand elasticity for all fruit drinks.Then

Accepted Answer

A) |E1| > |E2| > |E3| 
B) |E2| > |E3| > |E1| 
C) |E3| > |E1| > |E2| 
D) |E3| > |E2| > |E1| 
A) |E1| > |E2| > |E3| 
B) |E2| > |E3| > |E1| 
C) |E3| > |E1| > |E2| 
D) |E3| > |E2| > |E1|

Question 12

To answer the question,refer to the following table showing a demand schedule:   If price falls from $200 to $150,what is the elasticity of demand over this range?

Accepted Answer

A) -0.62 
B) -1.0 
C) -1.17 
D) -2.5 
E) -3.0 
A) -0.62 
B) -1.0 
C) -1.17 
D) -2.5 
E) -3.0

Question 13

Suppose that the Houston Rockets' management is considering a plan in which fans who donate blood can attend games for $35 instead of the usual $50.If both ticket revenues and blood donations rise with this plan,which of the following is true?

Accepted Answer

A) The demand for Houston Rockets' tickets is price elastic. 
B) The demand for Houston Rockets' tickets is price inelastic. 
C) The demand for blood donations is price elastic. 
D) The demand for blood donations is price inelastic. 
A) The demand for Houston Rockets' tickets is price elastic. 
B) The demand for Houston Rockets' tickets is price inelastic. 
C) The demand for blood donations is price elastic. 
D) The demand for blood donations is price inelastic.

Question 14

Which of the following would tend to INCREASE the elasticity of demand for good X?

Accepted Answer

A) a new discovery allows firms to produce X at a much lower cost. 
B) the percent of a consumer's income spent on good X declines. 
C) a new product,Y,which can be used in place of X,is introduced. 
D) both b and c 
E) all of the above 
A) a new discovery allows firms to produce X at a much lower cost. 
B) the percent of a consumer's income spent on good X declines. 
C) a new product,Y,which can be used in place of X,is introduced. 
D) both b and c 
E) all of the above

Question 15

When the price of corn dogs is $0.50,10,000 corn dogs are demanded.When the price of corn dogs is $1.20,5,000 are demanded.What is the price elasticity of demand for corn dogs?

Accepted Answer

A) -0.40 
B) -0.81 
C) -1.20 
D) -1.40 
A) -0.40 
B) -0.81 
C) -1.20 
D) -1.40

Question 16

According to the following figure,the equation for marginal revenue is

Accepted Answer

A) MR = 50 -0.025Q. 
B) MR = 4,000 - 2,000Q. 
C) MR = 4,000 -100Q. 
D) MR = 50 - 160Q. 
E) none of the above 
A) MR = 50 -0.025Q. 
B) MR = 4,000 - 2,000Q. 
C) MR = 4,000 -100Q. 
D) MR = 50 - 160Q. 
E) none of the above

Question 17

Refer to the following figure.At a price of $1,the point elasticity of demand for D2 is ________ and marginal revenue is _______.

Accepted Answer

A) -5; positive 
B) -0.5; negative 
C) -0.2; negative 
D) -1; zero 
A) -5; positive 
B) -0.5; negative 
C) -0.2; negative 
D) -1; zero

Question 18

In the figure above,what is the point price elasticity of demand when price is $80?

Accepted Answer

A) -0.50 
B) -0.75 
C) -1.00 
D) -1.60 
E) -2.00 
A) -0.50 
B) -0.75 
C) -1.00 
D) -1.60 
E) -2.00

Question 19

In the figure above,what is demand elasticity over the price range $40 to $60?

Accepted Answer

A) -2.00 
B) -1.00 
C) -0.50 
D) -0.95 
E) -0.71 
A) -2.00 
B) -1.00 
C) -0.50 
D) -0.95 
E) -0.71

Question 20

If the demand for plastic surgery is price inelastic,

Accepted Answer

A) changes in price do not affect the number of operations. 
B) then when more plastic surgery is performed,total expenditures on plastic surgery will decrease. 
C) the percentage change in price is less than the percentage change in quantity. 
D) both b and c 
E) both a and b 
A) changes in price do not affect the number of operations. 
B) then when more plastic surgery is performed,total expenditures on plastic surgery will decrease. 
C) the percentage change in price is less than the percentage change in quantity. 
D) both b and c 
E) both a and b

Refer to the following figure.The point elasticities of demand for D₁,D₂,and D₃ at a price of $5 are __,,and _,respectively.

According to the following figure,demand is unitary elastic at P = $________.

When marginal revenue is positive,

When demand is inelastic,

If the price elasticity of demand for a good is -0.8 and quantity demanded decreases by 40%,price must have

Interior Department recently announced that it will increase the entrance fees at Yellowstone National Park in order to increase park revenues.The Interior Department must believe that

Use the figure below,which shows a linear demand curve and the associated total revenue curve,to answer the question. The price for which 100 units can be sold is $_____.

To answer the question,refer to the following table showing a demand schedule: As quantity demanded rises from 1,400 to 1,800,what is marginal revenue?

Refer to the following graph to answer the question: Suppose price rises from $90 to $110.Using representative arrows,the price effect is a relatively __ short,long)arrow pointing _ upward,downward).

To answer the question,refer to the following table showing a demand schedule: If price falls from $150 to $100,

E₁ is demand elasticity for Minute Maid orange juice,E₂ is demand elasticity for all orange juice,and E₃ is demand elasticity for all fruit drinks.Then

To answer the question,refer to the following table showing a demand schedule: If price falls from $200 to $150,what is the elasticity of demand over this range?

Suppose that the Houston Rockets' management is considering a plan in which fans who donate blood can attend games for $35 instead of the usual $50.If both ticket revenues and blood donations rise with this plan,which of the following is true?

Which of the following would tend to INCREASE the elasticity of demand for good X?

When the price of corn dogs is $0.50,10,000 corn dogs are demanded.When the price of corn dogs is $1.20,5,000 are demanded.What is the price elasticity of demand for corn dogs?

According to the following figure,the equation for marginal revenue is

Refer to the following figure.At a price of $1,the point elasticity of demand for D₂ is __ and marginal revenue is _.

In the figure above,what is the point price elasticity of demand when price is $80?

In the figure above,what is demand elasticity over the price range $40 to $60?

If the demand for plastic surgery is price inelastic,

Managers, profits, and Markets

Demand, supply, and Market Equilibrium

Marginal Analysis for Optimal Decision Making

Basic Estimation Techniques

Theory of Consumer Behavior

Demand Estimation and Forecasting

Production and Cost in the Short Run

Production and Cost in the Long Run

Production and Cost Estimation

Managerial Decisions in Competitive Markets

Managerial Decisions for Firms With Market Power

Strategic Decision Making in Oligopoly Markets

Advanced Pricing Techniques

Decisions Under Risk and Uncertainty

Government Regulation of Business

Filters

Exam 6: Elasticity and Demand

Refer to the following figure.The point elasticities of demand for D1,D2,and D3 at a price of $5 are ________,________,and _______,respectively.

According to the following figure,demand is unitary elastic at P = $________.

When marginal revenue is positive,

When demand is inelastic,

If the price elasticity of demand for a good is -0.8 and quantity demanded decreases by 40%,price must have

Interior Department recently announced that it will increase the entrance fees at Yellowstone National Park in order to increase park revenues.The Interior Department must believe that

Use the figure below,which shows a linear demand curve and the associated total revenue curve,to answer the question. The price for which 100 units can be sold is $_____.

To answer the question,refer to the following table showing a demand schedule: As quantity demanded rises from 1,400 to 1,800,what is marginal revenue?

Refer to the following graph to answer the question: Suppose price rises from $90 to $110.Using representative arrows,the price effect is a relatively ________ short,long)arrow pointing _______ upward,downward).

To answer the question,refer to the following table showing a demand schedule: If price falls from $150 to $100,

E1 is demand elasticity for Minute Maid orange juice,E2 is demand elasticity for all orange juice,and E3 is demand elasticity for all fruit drinks.Then

To answer the question,refer to the following table showing a demand schedule: If price falls from $200 to $150,what is the elasticity of demand over this range?

Suppose that the Houston Rockets' management is considering a plan in which fans who donate blood can attend games for $35 instead of the usual $50.If both ticket revenues and blood donations rise with this plan,which of the following is true?

Which of the following would tend to INCREASE the elasticity of demand for good X?

When the price of corn dogs is $0.50,10,000 corn dogs are demanded.When the price of corn dogs is $1.20,5,000 are demanded.What is the price elasticity of demand for corn dogs?

According to the following figure,the equation for marginal revenue is

Refer to the following figure.At a price of $1,the point elasticity of demand for D2 is ________ and marginal revenue is _______.

In the figure above,what is the point price elasticity of demand when price is $80?

In the figure above,what is demand elasticity over the price range $40 to $60?

If the demand for plastic surgery is price inelastic,

Managers, profits, and Markets

Demand, supply, and Market Equilibrium

Marginal Analysis for Optimal Decision Making

Basic Estimation Techniques

Theory of Consumer Behavior

Demand Estimation and Forecasting

Production and Cost in the Short Run

Production and Cost in the Long Run

Production and Cost Estimation

Managerial Decisions in Competitive Markets

Managerial Decisions for Firms With Market Power

Strategic Decision Making in Oligopoly Markets

Advanced Pricing Techniques

Decisions Under Risk and Uncertainty

Government Regulation of Business

Filters

Refer to the following figure.The point elasticities of demand for D₁,D₂,and D₃ at a price of $5 are __,,and _,respectively.

Refer to the following graph to answer the question: Suppose price rises from $90 to $110.Using representative arrows,the price effect is a relatively __ short,long)arrow pointing _ upward,downward).

E₁ is demand elasticity for Minute Maid orange juice,E₂ is demand elasticity for all orange juice,and E₃ is demand elasticity for all fruit drinks.Then

Refer to the following figure.At a price of $1,the point elasticity of demand for D₂ is __ and marginal revenue is _.