4: Elasticity: Videos with Questions
Required information The Midpoint Formula - Percentage Changes Video Which prices were used to calculate the midpoint elasticity of demand in this video? Multiple Choice ◉ $3 and $5 ◉ $2 and $4 ◉ $5 and $7 ◉ $4 and $6
$4 and $6
Required information Linear Demand and Price Elasticity (Midpoint Formula) Video rev: 08_31_2017_QC_CS-79107 Which of the following statements is true of a linear demand curve, according to the video? Multiple Choice ◉ When going from high prices to low prices, demand becomes more elastic. ◉ When going from high prices to low prices, demand becomes more inelastic. ◉ When going from high prices to low prices, demand elasticity remains constant. ◉ When going from high prices to low prices, demand may become more elastic or more inelastic, depending on the good in question.
When going from high prices to low prices, demand becomes more inelastic.
The following data relate to the supply schedule of a product. Price | Quantity Supplied $5 | 100 10 | 200 15 | 250 20 | 300 25 | 350 30 | 500 Using the midpoint formula, what is the price elasticity of supply when price increases from $5 to $10? rev: 05_14_2018 Multiple Choice ◉ 1 ◉ 0.69 ◉ 0.64 ◉ 0.51
1
Use the following graph to answer the question below. The horizontal axis ranges from Q1 through Q4 and the vertical axis ranges from P1 through P4. A decreasing line is labeled demand. The data points at the demand curve (Q1, P4), (Q2, P3), (Q3, P2), and (Q4, P1) connects to both the axes with dotted lines, forming 10 squares. From left to right and top to bottom, the squares are labeled A, B, C, and D; E, F and G; H and I; and J. If the price is P3, then the total revenue is represented by area rev: 05_14_2018 Multiple Choice ◉ B + C + D. ◉ E + F + G. ◉ B + C + D + E + F + G. ◉ A + B + C + D + E + F + G.
B + C + D + E + F + G.
Required information Elasticity of Supply - Immediate Period, Short Run, and Long Run Video According to the video, what does the supply curve look like in the immediate time period? Multiple Choice ◉ It is a fairly steep, upward-sloping line. ◉ It is a fairly flat, upward-sloping line. ◉ It is a vertical line. ◉ It is a horizontal line.
It is a vertical line.
Required information Determinants of Elasticity - Demand: Necessities, Luxuries, and Time Video Which of the following statements is true, according to the video? Multiple Choice ◉ The more time passes, the more elastic the demand for a good becomes. ◉ The demand for gasoline is more elastic than the demand for vacations. ◉ Luxuries have more inelastic demand, because those that buy them tend to be rich. ◉ The demand for medical care is more elastic than the demand for fresh fruit.
The more time passes, the more elastic the demand for a good becomes.
Which of the following factors will make the demand for a product relatively elastic? rev: 05_14_2018 Multiple Choice ◉ There are few substitutes. ◉ The time interval considered is long. ◉ The good is considered a necessity. ◉ Purchases of the good require a small portion of consumers' budgets.
The time interval considered is long.
The supply of product X is elastic if rev: 05_14_2018 Multiple Choice ◉ a 5% increase in price generates a 7% increase in quantity supplied. ◉ an 8% increase in price generates an 8% increase in quantity supplied. ◉ a 10% decrease in price does not affect quantity supplied. ◉ a 7% decrease in price generates a 5% decrease in quantity supplied.
a 5% increase in price generates a 7% increase in quantity supplied.
Required information Elasticity of Demand and Total Revenue Video rev: 03_03_2017_QC_CS-81425 What did the total revenue curve look like in the video? rev: 02_21_2017_QC_CS-80038 Multiple Choice ◉ an upward-sloping line ◉ a downward-sloping line ◉ a curve that looks like an upside-down U ◉ Shaped like a U opening up
a curve that looks like an upside-down U
Required information Price Elasticity of Demand (Midpoint Formula) Video Which example was used in this video? Multiple Choice ◉ a decrease in the price of a car ◉ an increase in the price of a car ◉ a decrease in the price of pizza ◉ an increase in the price of pizza
a decrease in the price of pizza
Required information Elasticity Video Which example was used in this video? rev: 03_31_2016_QC_CS-43622 Multiple Choice ◉ a decrease in the price of a car ◉ an increase in the price of a car ◉ a decrease in the price of pizza ◉ an increase in the price of pizza
an increase in the price of a car
Required information Price Elasticity of Supply (Midpoint Formula) Video Which example was used in this video? Multiple Choice ◉ a decrease in the price of a car ◉ an increase in the price of a car ◉ a decrease in the price of pizza ◉ an increase in the price of pizza
an increase in the price of pizza
Required information Income Elasticity of Demand Video Which good was used to explore the income elasticity of demand? Multiple Choice ◉ food ◉ clothing ◉ cars ◉ vacations
clothingCorrect
The cross-price elasticity of demand between product X and product Y is -1.2. It can be inferred that X and Y are rev: 05_14_2018 Multiple Choice ◉ substitutes. ◉ complements. ◉ unrelated. ◉ inferior.
complements.
Required information Determinants of Elasticity - Demand: Substitutes and Income Video Goods with more substitutes have more: rev: 10_10_2018_QC_CS-142660 Multiple Choice ◉ elastic demand, buyers can find alternatives to purchase if the price increases. ◉ elastic demand, buyers spend more income on these goods. ◉ inelastic demand, buyers can find alternatives to purchase if the price increases. ◉ inelastic demand, buyers spend more income on these goods.
elastic demand, buyers can find alternatives to purchase if the price increases.
Suppose you are given the following demand data for a product. Price | Quantity Demanded $10 | 30 9 | 40 8 | 50 7 | 60 6 | 70 The price elasticity of demand (based on the midpoint formula) when price decreases from $9 to $7 is rev: 05_14_2018 Multiple Choice ◉ elastic. ◉ inelastic. ◉ unit elastic. ◉ perfectly inelastic.
elastic.
Required information Video Which example was used to calculate the cross-price elasticity of demand between complements? Multiple Choice ◉ milk and cereal ◉ tortilla chips and guacamole ◉ peanut butter and jelly ◉ hot dogs and hot dog buns
hot dogs and hot dog buns
Answer the next question on the basis of the following demand schedule. Price | Quantity Demanded $6 | 1 5 | 2 4 | 3 3 | 4 2 | 5 1 | 6 The price elasticity of demand is relatively elastic (based on the midpoint formula) rev: 05_14_2018 Multiple Choice ◉ in the $6-$4 price range. ◉ over the entire $6-$1 price range. ◉ in the $3-$1 price range. ◉ in the $6-$5 price range only.
in the $6-$4 price range.
The definition of a normal good suggests that the rev: 05_14_2018 Multiple Choice ◉ income elasticity of demand for the good is negative. ◉ price elasticity of demand for the good is negative. ◉ income elasticity of demand for the good is greater than 0. ◉ cross-price elasticity of demand for the good is positive.
income elasticity of demand for the good is greater than 0.
If the demand for product X is inelastic, a 4 percent decrease in the price of X will Multiple Choice ◉ decrease the quantity of X demanded by more than 4 percent. ◉ decrease the quantity of X demanded by less than 4 percent. ◉ increase the quantity of X demanded by more than 4 percent. ◉ increase the quantity of X demanded by less than 4 percent.
increase the quantity of X demanded by less than 4 percent. Explanation The price elasticity of demand for a product equals the percentage change in quantity demanded divided (QD) by the percentage change in price (P). If the percentage change in QD is greater than the percentage change in P, then demand is price-elastic. In this question it is given that demand is price-inelastic, so the percentage change in QD must be less than the percentage change in P. Because of the law of demand, price and quantity demanded move in the opposite direction, so the price decrease will increase the quantity demanded of X.
Required information Elastic, Inelastic, and Unit-Elastic Demand Video Which of these goods had elastic demand in the video? Multiple Choice ◉ oranges ◉ pizza ◉ movie tickets ◉ gasoline
oranges
Required information Cross-Price Elasticity of Demand for Substitutes Video In the video, the cross-price elasticity of demand between Coke and Pepsi was: Multiple Choice ◉ positive and less than 1. ◉ positive and greater than 1. ◉ negative and greater than ?1. ◉ negative and less than ?1.
positive and greater than 1.
The demand schedules for such products as eggs, bread, and electricity tend to be rev: 05_14_2018 Multiple Choice ◉ perfectly elastic. ◉ unit-elastic. ◉ relatively inelastic. ◉ relatively elastic.
relatively inelastic.
The price elasticity of supply measures how Multiple Choice ◉ easily labor and capital can be substituted for one another in the production process. ◉ responsive the quantity supplied of X is to changes in the price of X. ◉ responsive the quantity supplied of Y is to changes in the price of X. ◉ responsive quantity supplied is to a change in incomes.
responsive the quantity supplied of X is to changes in the price of X.
The cross-price elasticity of demand between product X and product Y is 2. It can be inferred that X and Y are rev: 05_14_2018 Multiple Choice ◉ substitutes. ◉ complements. ◉ unrelated. ◉ normal.
substitutes.
Economists distinguish among the immediate period, the short run, and the long run by noting that rev: 05_14_2018 Multiple Choice ◉ supply is most elastic in the short run and perfectly inelastic in the immediate period. ◉ demand is most elastic in the long run and perfectly inelastic in the immediate period. ◉ supply is most elastic in the long run and perfectly inelastic in the immediate period. ◉ supply is most elastic in the short run and perfectly inelastic in the long run.
supply is most elastic in the long run and perfectly inelastic in the immediate period.
Required information Elastic, Inelastic and Unit-Elastic Supply Video Which of the following goods had elastic supply in the video? Multiple Choice ◉ books ◉ t-shirts ◉ digital tablets ◉ pizza
t-shirts