Econ 200

the short-run supply curve for pork is less elastic than the long-run supply curve for pork.

It takes a considerable amount of time to increase the production of pork. This implies that

positive, indicating substitute goods.

We would expect the cross elasticity of demand between Pepsi and Coke to be

negative, indicating complementary goods.

We would expect the cross elasticity of demand between dress shirts and ties to be

increased price elasticity of demand for movie theater tickets

What is the most likely effect of the development of rental movies and online movie streaming on the movie theater (or cinema) industry?

The time interval considered is long.

Which of the following factors will make the demand for a product relatively elastic?

There are a large number of good substitutes for the good.

Which of the following is not characteristic of a product with relatively inelastic demand?

In the range of prices in which demand is elastic, total revenue will diminish as price decreases.

Which of the following statements is not correct?

5 percent and quantity supplied rises by 7 percent.

The supply of product X is elastic if the price of X rises by

inelastic. Thus, the government's cigarette-tax revenues would rise with a tax increase.

A state government wants to increase the taxes on cigarettes to increase tax revenue. Because cigarettes are addictive, we would expect its demand to be

Price rises and demand is elastic.

In which of the following instances will total revenue decline?

relatively elastic

If price and total revenue vary in opposite directions, demand is

"The different brands are almost identical. I always buy the cheapest."

In some markets consumers may buy many different brands of a product. Which of the statements below best represents a situation where demand for a particular brand would be very elastic?

positive, and therefore these goods are substitutes.

Suppose that a 10 percent increase in the price of normal good Y causes a 20 percent increase in the quantity demanded of normal good X. The coefficient of cross elasticity of demand is

a 10 percent increase in income will increase the purchase of toys by 20 percent.

Suppose the income elasticity of demand for toys is +2.0. This means that

a 12 percent increase in income will decrease the purchase of toys by 6 percent.

Suppose the income elasticity of demand for toys is −0.5. This means that

the railroad felt that the demand for passenger service was inelastic and opponents of the rate increase felt it was elastic

The Illinois Central Railroad once asked the Illinois Commerce Commission for permission to increase its commuter rates by 20 percent. The railroad argued that declining revenues made this rate increase essential. Opponents of the rate increase contended that the railroad's revenues would fall because of the rate hike. It can be concluded that

there are more substitutes for Cheerios than for cereals as a whole.

The demand for Cheerios cereal is more price-elastic than the demand for cereals as a whole. This is best explained by the fact that

greater their substitutability.

The larger the positive cross elasticity coefficient of demand between products X and Y, the

consumers will be better able to find substitutes.

The price elasticity of demand increases with the length of the period considered because

responsive the quantity supplied of X is to changes in the price of X.

The price elasticity of supply measures how