Chapter 6 Micro Econ
The____of a demand curve, its flatness or steepness, is not a sound basis for judging elasticity
slope
In the immediate market period, the______curve is vertical
supply
The percentage change in quantity supplied divided by the percentage change in price measures the price elasticity of____
supply
The percentage change in quantity supplied divided by the percentage change in price measures the price elasticity of_______
supply
sensitivity of the demand for one product to a change in a price of another product
cross
The price______of demand measures the responsiveness, or sensitivity, of consumers to a price change.
elasticity
As you move along the demand curve from higher to lower price, the price elasticity of demand __________
declines
Economists usually ignore the minus sign in the price elasticity of_____coefficient to avoid ambiguity
demand
The formula for the cross elasticity of demand is written as the percentage change in the quantity demanded of one product_______________by the percentage change in the price of another product.
divided
The income elasticity of demand shows the responsiveness of demand for a good or service when an individual's ______changes
earnings
If the quantity supplied by producers is relatively responsive to price changes, supply is relatively price______
elastic
Supply is_____if the price elasticity coefficient is greater than 1
elastic
The price elasticity of supply is much more______in the long run than in the short run
elastic
When the price elasticity of demand is relatively price _______, a price decrease will increase total revenue
elastic
the larger the number of sub goods available, the________the coefficient for the price elasticity of demand
greater
The______market period is the length of time over which producers are unable to respond to a change in price with a change in quantity supplied
immediate
A good with zero cross elasticity are called_______goods.
independent`
A price increase will increase total revenue if the price elasticity of demand is relatively price_________
inelastic
A small percentage change in quantity demanded divided by a larger percentage change in price indicates__________demand
inelastic
Because of the limited, highly_____supply of gold, small changes in demand produce large changes in price
inelastic
If a specific percentage change in price produces a smaller percentage change in quantity demanded, the demand is_____
inelastic
price and total revenue move in the same direction
inelastic
If a good has a negative income elasticity coefficient, then it is classified as a(n)_____good
inferior
If a good has a negative income elasticity coefficient, then it is classified as a(n)____good.
inferior
A time period in which firms can adjust their plant size is known as the_________run
long
Since price and quantity demanded are inversely related, the price elasticity of demand coefficient would always be a ____________ number.
negative
When the cross-price elasticity is ___________, the goods are complementary
negative
A__________good is one that is demanded more as income rises
normal
If the income elasticity coefficient is positive, the the good is a______good
normal
Customers often need ________ to adjust to changes in prices`
time
The passage of_______involved in making a decision is one determinant of the price elasticity of demand.
time
If the price changes and total revenue remains constant, the price elasticity of demand must be____elastic
unit
