ECON 102- A.4.4.1

If a 25% change in price results in a 40% change in quantity supplied, then the price elasticity of supply is about

1.60, and supply is elastic.

When the local used bookstore prices economics books at $15 each, it generally sells 70 books per month. If it lowers the price to $7, sales increase to 90 books per month. Given this information, we know that the price elasticity of demand for economics books is about

0.34, and an increase in price from $7 to $15 results in an increase in total revenue.

Table 5-2 Price | Quantity $100 | 0 $80 | 10 $60 | 20 $40 | 30 $20 | 40 $0 | 50 Refer to Table 5-2. Using the midpoint method, if the price falls from $40 to $20, the absolute value of the price elasticity of demand is

0.43.

Figure 5-13 Refer to Figure 5-13. Using the midpoint method, what is the price elasticity of supply between $100 and $220?

0.58

Table 5-2 Price | Quantity $100 | 0 $80 | 10 $60 | 20 $40 | 30 $20 | 40 $0 | 50 Refer to Table 5-2. Using the midpoint method, if the price falls from $60 to $40, the absolute value of the price elasticity of demand is

1.

Figure 5-13 Refer to Figure 5-13. Using the midpoint method, what is the price elasticity of supply between $16 and $40?

1.0

Figure 5-1 Refer to Figure 5-1. Between point A and point B, price elasticity of demand is equal to

1.5

If a 10% decrease in price for a good results in a 20% increase in quantity demanded, the price elasticity of demand is (the percentages for the formula are in the statement)

2.

Table 5-2 Price | Quantity $100 | 0 $80 | 10 $60 | 20 $40 | 30 $20 | 40 $0 | 50 Refer to Table 5-2. Using the midpoint method, if the price falls from $80 to $60, the absolute value of the price elasticity of demand is

2.33.

At a price of $1.20, a local coffee shop is willing to supply 100 cinnamon rolls per day. At a price of $1.40, the coffee shop would be willing to supply 150 cinnamon rolls per day. Using the midpoint method, the price elasticity of supply is about

2.60

Suppose the price elasticity of supply for soccer balls is 0.3 in the short run and 1.2 in the long run. If an increase in the demand for soccer balls causes the price of soccer balls to increase by 20%, then the quantity supplied of soccer balls will increase by about

6% in the short run and 24% in the long run.

The production of methamphetamine (meth) is a social problem in the Midwest. Iowa is considering two potential programs: Operation Methbust would increase the number of sheriffs' deputies to search out and destroy methamphetamine labs. Operation Say No to Meth would increase the training required of public school teachers so that they could better educate students about the health risks of using meth. Assuming that each program were successful, which of the following statements is correct?

Operation Methbust would reduce the supply of meth; Operation Say No would reduce the demand for meth.

Table 5-2 Price | Quantity $100 | 0 $80 | 10 $60 | 20 $40 | 30 $20 | 40 $0 | 50 Refer to Table 5-2. Using the midpoint method, if the price falls from $80 to $60, the price elasticity of demand is

elastic.

Table 5-4 Price | Total Revenue $10 | $100 $12 | $108 $14 | $112 $16 | $112 Use the Total Revenue Test Refer to Table 5-4. When price is between $10 and $14, demand is

inelastic.

Table 5-2 Price | Quantity $100 | 0 $80 | 10 $60 | 20 $40 | 30 $20 | 40 $0 | 50 Refer to Table 5-2. Using the midpoint method, if the price falls from $60 to $40, the price elasticity of demand is

unit elastic.

The federal government is concerned about obesity in the United States. Congress is considering two plans. One will ban the production and sale of "junk food." The other will increase nutrition-education programs and include substantial advertising campaigns to encourage healthy eating habits. The junk-food ban program

will reduce the quantity of junk food sold and raise the price. The education program will reduce the quantity of junk food sold and lower the price.