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