Economics

At price of $1.30 per pound, a local apple orchard is willing to supply 150 pounds of apples per day. At a price of $1.50 per pound, the orchard is willing to supply 170 pounds of apples per day. Using the midpoint method, the price elasticity of supply is about what?

.875

Using the midpoint method, what is the price elasticity of supply between points C and D? Question 19

0.73

Consider Luxury weekend hotel packages in Las Vegas. When the price is $250, the quantity demanded is 2,000 packages per week. When the price is $280, the quantity demanded is 1,700 packages per week. Using the midpoint method, the price elasticity of demand is about?

1.43, and an increase in the price will cause the hotels' total revenue to decrease

For a particular good, a 2% increase in price causes a 12% decrease in quantity demanded. Which of the following statements is most likely applicable to this good? A. The good is a luxury B. The relevant time horizon is short C. There are no close substitutes for this good. D. The market for the good is broadly defined.

A. The good is a luxury.

For a particular good, a 5% increase in price causes a 15% decrease in quantity demanded. Which of the following statements is most likely applicable to this good? A. There are many substitutes for this good. B. The good is a necessity C. The relevant time horizon is short. D. The market for the good is broadly defined

A. There are many substitutes for this good.

For which of the following goods is the income elasticity of demand likely highest? A. Allergy Medicine B. Tennis Lessons C. Cell phone contracts D. Clothing

B. Tennis Lessons

Assume, for a good in question, two specific points on the demand curve are (Q = 2,000, P= $15) and (Q=2,400, P= $12) Then which of the following scenarios is possible?

Both of these points lie on section BC of the demand curve.

For which of the following goods is the price elasticity of demand most inelastic? A. Dominos large pepperoni pizza B. Large Pizza C. Pizza D. Large pepperoni pizza

C. Pizza

If marijuana were legalized, it is likely that there would be an increase in the supply of marijuana. Advocates of marijuana legalization argue that this would significantly reduce the amount of revenue going to the criminal organizations that currently supply marijuana. These advocates believe that the

Demand for marijuana is inelastic

Elasticity of demand is closely related to the slope of the demand curve. The more responsive buyers are to a change in price, the

Flatter the demand curve will be

Demand is elastic if the price elasticity of demand is

Greater than 1.

Which demand curve is unit elastic? Question 6

None of the above

Holding all other forces constant, if decreasing the price of a good leads to a decrease in total revenue, then the demand for the good must be

Inelastic

How does total revenue change as one moves downward and to the right along a linear demand curve?

It first increases, then decreases.

Question 8

LOOK OVER DAT HOE

Demand is inelastic if the price is less then what?

Less than 1.

For a particular good, an 8% increase in the price causes a 4% decrease in quantity demanded. Which of the following statements is most likely applicable to this good?

The market for the good is broadly defined

Question 17

Read dat hoe

Figure out how to determine if a demand curve is inelastic

Study

Assume, for a good in question, two specific points on the demand curve are (Q = 1,000, P= $40) and (Q=1,500, P= $30) Then which of the following scenarios is possible?

The vertical intercept of the demand curve is the point (Q = 0, P = $60)

A key determinant of the price of elasticity of supply is the

Time Horizon.

For which of the following goods is the income elasticity of demand likely lowest? A. Sapphire Pendant Necklaces B. Water C. Fresh Fruit D. Filet Mignon Steaks

Water

A manufacturer produces 1,000 units, regardless of the market price. For this firm, the price elasticity of supply is

Zero