If the price of good X rises and the demand for good X is elastic, then the percentage __________ in quantity demanded is __________ the percentage rise in price, and total revenue __________.
-fall; greater than; falls
-fall; less than; falls
-rise; greater than; falls
-fall; greater than; ris...
Econ 402 Exam #2 || with 100% Errorless Answers.
If the price of good X rises and the demand for good X is elastic, then the percentage
__________ in quantity demanded is __________ the percentage rise in price, and total revenue
__________.
-fall; greater than; falls
-fall; less than; falls
-rise; greater than; falls
-fall; greater than; rises correct answers fall; greater than; falls
Suppose that when the price of a good rises from $12 to $14, the quantity demanded of that good
falls from 220 units to 180 units. What is the approximate price elasticity of demand between
these two prices?
-1.73
-.27
-.77
-1.3 correct answers 1.3
If the percentage change in quantity demanded is less than the percentage change in price for
good Y, then the demand for good Y is
-unit elastic
-perfectly elastic
-inelastic
-elastic correct answers inelastic
The fewer substitutes for a good,
-the lower its income elasticity of demand.
-the lower its price elasticity of demand.
-the higher its price elasticity of demand
-the higher its income elasticity of demand. correct answers the lower its price elasticity of
demand.
Which of the following statements is false?
-Ham has a higher price elasticity of demand than meat.
-Soap has a higher price elasticity of demand than Ivory brand soap.
-Carrots have a higher price elasticity of demand than vegetables.
-Peaches have a higher price elasticity of demand than fruit. correct answers Soap has a higher
price elasticity of demand than Ivory brand soap.
The shorter the period of time consumers have to adjust to price changes, the __________ the
__________ elasticity of demand.
-lower; price
-higher; price
-higher; income
-lower; income correct answers lower; price
, Cross elasticity of demand measures the responsiveness of changes in the quantity __________
of one good to changes in __________.
-demanded; income
-supplied; the price of the same good
-demanded; the price of another good
-demanded; the price of the same good correct answers demanded; the price of another good
If the cross elasticity of demand for two goods is negative,
-one of the goods is necessarily a normal good, and the other good is necessarily an inferior
good.
-both goods are normal goods
-the goods are substitutes.
-the goods are complements. correct answers the goods are complements.
If the cross elasticity of demand for good A with respect to good B is 2.7, then good A is
-a substitute for good B.
-a normal good.
-an inferior good.
-a complement to good B. correct answers a substitute for good B.
If Jack bought 12 DVDs last year when his income was $40,000 and he buys 14 DVDs this year
when his income is $43,000, then his income elasticity of demand is ______________ which
means that DVDs are a(n) ______________ good for Jack.
-+2.13; normal
--0.47; inferior
--2.13; inferior
-+0.41; normal correct answers +2.13; normal
If Casey bought 16 cotton t-shirts last year when her income was $40,000 and she buys 14 cotton
t-shirts this year when her income is $45,000, then for Casey cotton t-shirts are
-a normal good.
- a substitute good.
-an inferior good.
-a complementary good. correct answers an inferior good.
An inferior good is
-any good that consumers think is of low quality.
-a good for which the quantity demanded increases as its price decreases.
-a good for which the demand rises as income falls.
-a good for which the demand rises as income rises. correct answers a good for which the
demand rises as income falls.
Suppose a producer decides that if the price of his or her product is $10, the quantity supplied
will be 1,000 units, and if the price is $11, the quantity supplied will be 1,100. The supply of the
good is
-perfectly elastic
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