FiltersDone

Question type

Essay

Multiple Choice

Short Answer

True False

Matching

Exam 4: Elasticity

Show Answer

Share

---

All types

Filters

Study Flashcards

Question 41

Multiple Choice

Review LaterAdd Note

Review Later

Suppose you are shown two intersecting demand curves that are drawn on the same scale. At the point of intersection, one of the demand curves is steeper than the other. Which of the following could explain the difference in slopes?

A) It is not possible to compare the slopes of different demand curves.
B) The flatter one is for a good with no close substitutes.
C) The steeper one has a higher income elasticity of demand.
D) The steeper one applies for the short run whereas the flatter one applies for the long run.
E) The steeper one is probably the demand curve for a luxury good.

Correct Answer

verified

Show Answer

Question 42

Multiple Choice

Review LaterAdd Note

Review Later

$\text { Demand Schedule for Ski Tickets }$ $\begin{array}{|l|l|}\hline \text { Price (\$) } & \begin{array}{l}\text { Quantity } \\\text { Demanded (no. of } \\\text { tickets) }\end{array} \\\hline 120 & 0 \\\hline 110 & 100 \\\hline 100 & 200 \\\hline 90 & 300 \\\hline 80 & 400 \\\hline 70 & 500 \\\hline 60 & 600 \\\hline 50 & 700 \\\hline 40 & 800 \\\hline 30 & 900 \\\hline 20 & 1000 \\\hline 10 & 1100 \\\hline 0 & 1200 \\\hline\end{array}$ $\text { TABLE 4-2 }$ -Refer to Table 4- 2. Total expenditure for ski tickets reaches a maximum at a price/quantity demanded combination of

A) $80/400
B) $100/200
C) $30/90
D) $20/1000
E) $60/600

Correct Answer

verified

Show Answer

Question 43

Multiple Choice

Review LaterAdd Note

The table below shows the demand schedule for museum admissions in a small city. $\begin{array}{|c|c|}\hline \begin{array}{c}\text { Price } \\\text { (per visit } \\\text { per person) }\\\end{array} & \begin{array}{c}\text { QuantityDemanded } \\\text { (thousands of }\\\text { person-visits per year) }\end{array} \\\hline \$ 10 & 2 \\\hline \$ 8 & 4 \\\hline \$ 6 & 6 \\\hline \$ 4 & 8 \\\hline \$ 2 & 10 \\\hline\end{array}$ TABLE 4- 1 -Refer to Table 4- 1. Between the prices of $4 and $6 the price elasticity of demand is

The elasticity of supply for some product will tend to be larger

If firms' costs rise rapidly as output increases, the

A demand curve for which any price- quantity combination yields the same total expenditure reveals a price elasticity of demand equal to

Suppose that the quantity demanded of a good rises from 40 units to 60 units per month when the price falls from $1.05 to 95 cents per unit. The price elasticity of demand for this product is

FIGURE 4- 2 -Refer to Figure 4- 2. In part 3 of the figure, the elasticity of demand between prices $10 and $20 is

If two goods, X and Y, have a negative cross- elasticity of demand, then we know that they

Suppose Statistics canada reports that total income earned by Canadian barley farmers has declined as a result of a partial crop failure that has driven up the Canadian price of barley. We can conclude that the price elasticity of demand for barley in Canada is

If the demand for some good fluctuates, but supply is constant, then which of the following combinations would generally yield the greatest price fluctuations?

Suppose that the quantity demanded of paperback novels rises from 80 000 to 120 000 units per month when the price falls from $11 to $9 per unit. The price elasticity of demand for this product is

A value of infinity for the elasticity of supply of some product implies that

Consider the following data for a hypothetical economy. $\begin{array}{|l|l|l|l|l|l|}\hline \text { Year } &\begin{array}{l}\text { Average } \\\text { Household } \\\text { Income }(\$) \end{array} & \begin{array}{l}\text { Price of Transit } \\\text { Passes }\end{array} & \begin{array}{l}\text { Qty } \\\text { Demanded of } \\\text { TransitPasses }\end{array} & \begin{array}{l}\text { Price of } \\\text { Gasoline } \\\text { (\$litre) }\end{array} & \begin{array}{l}\text { Qty Demanded } \\\text { of G asoline } \\\text { (millions of litres) }\end{array} \\\hline 2009 & 80000 & 60 & 99000 & 0.95 & 1940 \\\hline 2010 & 80000 & 60 & 101000 & 1.05 & 2060 \\\hline\end{array}$ TABLE 4- 5 -Refer to Table 4- 5. The cross- price elasticity of demand for transit passes in terms of the price of gasoline is _. We can therefore conclude that these two goods are .

The price of apples at a local market rises from $2.95 to $3.05 per kilo, and as a result the quantity of oranges that households purchase increases from 3950 to 4050 kilos per week. The cross- price elasticity is

If the price elasticity of demand is 1.4, a 10 percent increase in the price of the good results in

$\text { Demand Schedule for Ski Tickets }$ $\begin{array}{|l|l|}\hline \text { Price (\$) } & \begin{array}{l}\text { Quantity } \\\text { Demanded (no. of } \\\text { tickets) }\end{array} \\\hline 120 & 0 \\\hline 110 & 100 \\\hline 100 & 200 \\\hline 90 & 300 \\\hline 80 & 400 \\\hline 70 & 500 \\\hline 60 & 600 \\\hline 50 & 700 \\\hline 40 & 800 \\\hline 30 & 900 \\\hline 20 & 1000 \\\hline 10 & 1100 \\\hline 0 & 1200 \\\hline\end{array}$ $\text { TABLE 4-2 }$ -Refer to Table 4- 2. The price elasticity of demand over the interval of the demand curve between prices of $40 and $20 is

If a product's income elasticity of demand is - 1.7, then we can conclude that

If total expenditure on a product rises and falls directly with a product's price, then demand for this product has an elasticity of

If a product's income elasticity is - 3.4, then we can conclude that