Reading 13: Elasticity LOS b(part1)习题精选

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2^#

发表于 2010-4-16 15:55 | 只看该作者

If the demand curve for a given product is a straight line, this indicates that:

A)	demand is unit elastic.

B)	demand is more elastic at higher prices.

C)	elasticity is constant along the demand curve.

Elasticities will be greater (in absolute value) at higher prices.

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3^#

发表于 2010-4-16 15:55 | 只看该作者

If the price of World Cup Soccer tickets increases from $40 a ticket to $50 a ticket and the quantity demanded of tickets stays the same, demand for the tickets is:

A)	perfectly inelastic.

B)	elastic, but not perfectly elastic.

C)	inelastic, but not perfectly inelastic.

Since the quantiy of tickets demanded stayed the same after the price changed, the demand curve would have to be vertical which is a perfectly inelastic demand curve.

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4^#

发表于 2010-4-16 15:55 | 只看该作者

When demand for a good is inelastic, a higher price will:

A)	fail to reduce the quantity demanded for the good.

B)	lead to an increase in total expenditures for the good.

C)	have no impact on the demand for the good.

When demand is relatively inelastic, consumers do not reduce their quantity demanded very much when the price increases. That is, a given percentage increase in price results in a smaller percentage reduction in quantity demanded. Thus, total expenditures on the good increase. "Fail to reduce the quantity demanded for the good" is inaccurate because that would only be true if demand was perfectly inelastic.

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5^#

发表于 2010-4-16 15:55 | 只看该作者

If a good has elastic demand, a small price decrease will cause:

A)	a larger increase in quantity demanded.

B)	no change in the quantity demanded.

C)	a larger decrease in the quantity demanded.

If a good has elastic demand, a small price decrease will cause a larger increase in the quantity demanded.

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6^#

发表于 2010-4-16 15:56 | 只看该作者

If quantity demanded increases 15% when the price drops 1%, demand for this good:

A)	perfectly elastic.

B)	elastic, but not perfectly elastic.

C)	inelastic, but not perfectly inelastic.

Whenever quantity demanded for a good changes by a greater percentage than price, the price elasticity of demand will be greater than 1.0 and demand for the product is considered to be elastic.

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7^#

发表于 2010-4-16 15:56 | 只看该作者

If quantity demanded increases 15% when the price drops 1%, demand for this good:

A)	perfectly elastic.

B)	elastic, but not perfectly elastic.

C)	inelastic, but not perfectly inelastic.

Whenever quantity demanded for a good changes by a greater percentage than price, the price elasticity of demand will be greater than 1.0 and demand for the product is considered to be elastic.

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8^#

发表于 2010-4-16 15:57 | 只看该作者

If quantity demanded increases 15% when the price drops 1%, demand for this good:

A)	perfectly elastic.

B)	elastic, but not perfectly elastic.

C)	inelastic, but not perfectly inelastic.

Whenever quantity demanded for a good changes by a greater percentage than price, the price elasticity of demand will be greater than 1.0 and demand for the product is considered to be elastic.

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9^#

发表于 2010-4-16 15:59 | 只看该作者

For a linear demand curve, at the price where elasticity is -2.0, reducing prices will:

A)	increase total revenue and we are not at the point of maximum total revenue.

B)	increase total revenue and we are at the point of maximum total revenue.

C)	decrease total revenue and we are not at the point of maximum total revenue.

If the price elasticity of demand is -2.0, this indicates that the percentage change in quantity demanded is twice the percentage change in price. Thus, a decrease in price will be more than offset by the increase in quantity, and total revenue will increase. We are not at the point of maximum total revenue which is where elasticity is -1.0—the point of unit elastic demand.