Question 1

-In the figure above,using the midpoint method,what is the price elasticity of demand between points A and B?

Accepted Answer

A)  0.05 
B)  0.13 
C)  0.43 
D)  1.00 
E)  2.33 
A)  0.05 
B)  0.13 
C)  0.43 
D)  1.00 
E)  2.33

Question 2

People take fewer trips by airplane when their incomes fall because of a recession.Trips by airplane must be

Accepted Answer

A)  a normal good. 
B)  an inferior good. 
C)  a substitute for other goods. 
D)  a complement to other goods. 
E)  an inelastic good. 
A)  a normal good. 
B)  an inferior good. 
C)  a substitute for other goods. 
D)  a complement to other goods. 
E)  an inelastic good.

Question 3

As more time passes,the price elasticity of gasoline

Accepted Answer

A)  increases. 
B)  decreases. 
C)  stays the same. 
D)  becomes perfectly inelastic. 
E)  becomes perfectly elastic. 
A)  increases. 
B)  decreases. 
C)  stays the same. 
D)  becomes perfectly inelastic. 
E)  becomes perfectly elastic.

Question 4

The cross elasticity of demand for blank DVDs and DVD burners is likely to be

Accepted Answer

A)  positive because they are substitutes. 
B)  positive because they are complements. 
C)  negative because they are substitutes. 
D)  negative because they are complements. 
E)  negative because with the advent of digital cameras, film and film cameras are inferior goods. 
A)  positive because they are substitutes. 
B)  positive because they are complements. 
C)  negative because they are substitutes. 
D)  negative because they are complements. 
E)  negative because with the advent of digital cameras, film and film cameras are inferior goods.

Question 5

The extent to which the demand for a good changes when the price of a substitute or complement changes,other things remaining the same,is measured as the

Accepted Answer

A)  income elasticity of demand. 
B)  cross elasticity of demand. 
C)  price elasticity of demand. 
D)  price elasticity of supply. 
E)  cross income elasticity of demand. 
A)  income elasticity of demand. 
B)  cross elasticity of demand. 
C)  price elasticity of demand. 
D)  price elasticity of supply. 
E)  cross income elasticity of demand.

Question 6

A product that has a negative income elasticity of demand is ________ good.

Accepted Answer

A)  a complementary 
B)  a substitute 
C)  a normal 
D)  an inferior 
E)  a negative 
A)  a complementary 
B)  a substitute 
C)  a normal 
D)  an inferior 
E)  a negative

Question 7

Suppose the local university charges $85 per credit hour.If tuition increases from $85 to $93 per credit hour,using the midpoint method,what is the percentage change in price?

Accepted Answer

A)  8.99 percent 
B)  8.00 percent 
C)  9.41 percent 
D)  8.62 percent 
E)  9.12 percent 
A)  8.99 percent 
B)  8.00 percent 
C)  9.41 percent 
D)  8.62 percent 
E)  9.12 percent

Question 8

If the price elasticity of demand for opera tickets in Orlando is 1.00,then the demand for opera tickets in Orlando is

Accepted Answer

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

Question 9

The figure above shows the supply curve for roses.
-In the figure above,at the point where the price is $60 per bunch,the price elasticity of supply is

Accepted Answer

A)  1.8. 
B)  0.56. 
C)  1. 
D)  1.5. 
E)  0. 
A)  1.8. 
B)  0.56. 
C)  1. 
D)  1.5. 
E)  0.

Question 10

If the price of a good decreases from $9 to $6 and the quantity supplied decreases from 1,500 to 1,300,using the midpoint formula the elasticity of supply equals

Accepted Answer

A)  0.20. 
B)  2.80. 
C)  0.36. 
D)  0.40. 
E)  3.20. 
A)  0.20. 
B)  2.80. 
C)  0.36. 
D)  0.40. 
E)  3.20.

Question 11

If the price of a a good increases by 10 percent and the quantity supplied increases by 5 percent,then the elasticity of supply is

Accepted Answer

A)  greater than one and supply is elastic. 
B)  negative and supply is inelastic. 
C)  less than one and supply is elastic. 
D)  less than one and supply is inelastic. 
E)  greater than one and supply is inelastic. 
A)  greater than one and supply is elastic. 
B)  negative and supply is inelastic. 
C)  less than one and supply is elastic. 
D)  less than one and supply is inelastic. 
E)  greater than one and supply is inelastic.

Question 12

If the price of a good rises,then moving along a demand curve the percentage change in the quantity demanded will be

Accepted Answer

A)  positive. 
B)  negative. 
C)  zero. 
D)  either positive, negative, or zero depending on how the demand curve shifted. 
E)  undefined. 
A)  positive. 
B)  negative. 
C)  zero. 
D)  either positive, negative, or zero depending on how the demand curve shifted. 
E)  undefined.

Question 13

How are the cross elasticity of demand and income elasticity of demand similar and how are they different from the price elasticity of demand?

Accepted Answer

The cross and income elasticities are si

Question 14

-The demand curve shown in the figure above is ________ over the price range from $95 to $105 per unit.

Accepted Answer

A)  perfectly elastic 
B)  perfectly inelastic 
C)  unit elastic 
D)  elastic but not perfectly elastic 
E)  inelastic but not perfectly inelastic 
A)  perfectly elastic 
B)  perfectly inelastic 
C)  unit elastic 
D)  elastic but not perfectly elastic 
E)  inelastic but not perfectly inelastic

Question 15

-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?

Accepted Answer

A)  22.2 percent 
B)  10.0 percent 
C)  15.5 percent 
D)  5.2 percent 
E)  25 percent 
A)  22.2 percent 
B)  10.0 percent 
C)  15.5 percent 
D)  5.2 percent 
E)  25 percent

Question 16

The price elasticity of supply is always a positive value because
i.there is a direct relationship between the price and the quantity supplied.
ii.as the equilibrium price increases,the equilibrium quantity also always increases.
iii.buyers are willing to pay a higher price for larger quantities.

Accepted Answer

A)  i only 
B)  ii only 
C)  iii only 
D)  i and ii 
E)  ii and iii 
A)  i only 
B)  ii only 
C)  iii only 
D)  i and ii 
E)  ii and iii

Question 17

If the price of a Brita water filtration system increases and the quantity demanded of bottled water increases,then these two goods are

Accepted Answer

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

Question 18

When the percentage change in the quantity demanded equals the percentage change in price,then demand is

Accepted Answer

A)  inelastic. 
B)  unit elastic. 
C)  elastic. 
D)  irrelevant. 
E)  undefined. 
A)  inelastic. 
B)  unit elastic. 
C)  elastic. 
D)  irrelevant. 
E)  undefined.

Question 19

-In the figure above,using the midpoint method,the price elasticity of demand when the price falls from $7 to $6 is equal to

Accepted Answer

A)  2.50. 
B)  1.63. 
C)  0.40. 
D)  0.62. 
E)  1.00. 
A)  2.50. 
B)  1.63. 
C)  0.40. 
D)  0.62. 
E)  1.00.

Question 20

The income elasticity of demand for foreign travel

Accepted Answer

A)  is likely to be smaller than the income elasticity of demand for food. 
B)  is likely to be larger than the income elasticity of demand for food. 
C)  cannot be compared to the income elasticity of demand for food. 
D)  is likely to be inelastic. 
E)  is likely to be negative. 
A)  is likely to be smaller than the income elasticity of demand for food. 
B)  is likely to be larger than the income elasticity of demand for food. 
C)  cannot be compared to the income elasticity of demand for food. 
D)  is likely to be inelastic. 
E)  is likely to be negative.

-In the figure above,using the midpoint method,what is the price elasticity of demand between points A and B?

People take fewer trips by airplane when their incomes fall because of a recession.Trips by airplane must be

As more time passes,the price elasticity of gasoline

The cross elasticity of demand for blank DVDs and DVD burners is likely to be

The extent to which the demand for a good changes when the price of a substitute or complement changes,other things remaining the same,is measured as the

A product that has a negative income elasticity of demand is ________ good.

Suppose the local university charges $85 per credit hour.If tuition increases from $85 to $93 per credit hour,using the midpoint method,what is the percentage change in price?

If the price elasticity of demand for opera tickets in Orlando is 1.00,then the demand for opera tickets in Orlando is

The figure above shows the supply curve for roses. -In the figure above,at the point where the price is $60 per bunch,the price elasticity of supply is

If the price of a good decreases from $9 to $6 and the quantity supplied decreases from 1,500 to 1,300,using the midpoint formula the elasticity of supply equals

If the price of a a good increases by 10 percent and the quantity supplied increases by 5 percent,then the elasticity of supply is

If the price of a good rises,then moving along a demand curve the percentage change in the quantity demanded will be

How are the cross elasticity of demand and income elasticity of demand similar and how are they different from the price elasticity of demand?

-The demand curve shown in the figure above is ________ over the price range from $95 to $105 per unit.

-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?

The price elasticity of supply is always a positive value because i.there is a direct relationship between the price and the quantity supplied. ii.as the equilibrium price increases,the equilibrium quantity also always increases. iii.buyers are willing to pay a higher price for larger quantities.

If the price of a Brita water filtration system increases and the quantity demanded of bottled water increases,then these two goods are

When the percentage change in the quantity demanded equals the percentage change in price,then demand is

-In the figure above,using the midpoint method,the price elasticity of demand when the price falls from $7 to $6 is equal to

The income elasticity of demand for foreign travel

Getting Started

The Usand 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

-In the figure above,using the midpoint method,what is the price elasticity of demand between points A and B?

People take fewer trips by airplane when their incomes fall because of a recession.Trips by airplane must be

As more time passes,the price elasticity of gasoline

The cross elasticity of demand for blank DVDs and DVD burners is likely to be

The extent to which the demand for a good changes when the price of a substitute or complement changes,other things remaining the same,is measured as the

A product that has a negative income elasticity of demand is ________ good.

Suppose the local university charges $85 per credit hour.If tuition increases from $85 to $93 per credit hour,using the midpoint method,what is the percentage change in price?

If the price elasticity of demand for opera tickets in Orlando is 1.00,then the demand for opera tickets in Orlando is

The figure above shows the supply curve for roses. -In the figure above,at the point where the price is $60 per bunch,the price elasticity of supply is

If the price of a good decreases from $9 to $6 and the quantity supplied decreases from 1,500 to 1,300,using the midpoint formula the elasticity of supply equals

If the price of a a good increases by 10 percent and the quantity supplied increases by 5 percent,then the elasticity of supply is

If the price of a good rises,then moving along a demand curve the percentage change in the quantity demanded will be

How are the cross elasticity of demand and income elasticity of demand similar and how are they different from the price elasticity of demand?

-The demand curve shown in the figure above is ________ over the price range from $95 to $105 per unit.

-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?

The price elasticity of supply is always a positive value because i.there is a direct relationship between the price and the quantity supplied. ii.as the equilibrium price increases,the equilibrium quantity also always increases. iii.buyers are willing to pay a higher price for larger quantities.

If the price of a Brita water filtration system increases and the quantity demanded of bottled water increases,then these two goods are

When the percentage change in the quantity demanded equals the percentage change in price,then demand is

-In the figure above,using the midpoint method,the price elasticity of demand when the price falls from $7 to $6 is equal to

The income elasticity of demand for foreign travel

Getting Started

The Usand 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