Chapter 5
Elasticity and Its Applications
Test B
. The elasticity of demand measures
a. the increa in demand as additional buyers enter the market.
b. a buyer’s responsiveness to a change in the price of a good.香煎鱼
c. how much less of a good consumers will demand when incomes fall.
d. the increa in supply that will occur from an increa in the price of a good.
ANSWER: b. a buyer’s responsiveness to a change in the price of a good.
TYPE: M KEY1: D SECTION: 1 OBJECTIVE: 1 RANDOM: Y
超富. Demand is said to be inelastic if
禁烟运动 a. consumers hardly respond to a change in price.
b. consumers respond substantially to a change in price.
c. consumers respond directly to a change in income.
d. the change in quantity demanded is equal to the change in price.
ANSWER: a. consumers hardly respond to a change in price.
TYPE: M KEY1: D SECTION: 1 OBJECTIVE: 1 RANDOM: Y
. The elasticity of demand for luxuries tends to be
a. greater than 1.
b. equal to 1.
c. less than 1.
d. equal to 0.
ANSWER: c. less than 1.
TYPE: M KEY1: D SECTION: 1 OBJECTIVE: 1 RANDOM: Y
. Milky Way candy bars tend to have an elastic demand becau
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a. the candy bar market is too broadly defined.
b. there are many clo substitutes for Milky Ways.
c. Milky Ways are considered by some to be a necessity.
d. it is usually eaten quickly and therefore the time horizon is short.
ANSWER: b. there are many clo substitutes for Milky Ways.
TYPE: M KEY1: D SECTION: 1 OBJECTIVE: 2 RANDOM: Y
. Economists compute elasticity using the midpoint method primarily becau it
a. is the simplest method to compute elasticity.
b. us the same equation that is ud to compute slope.
c. automatically rounds quantities to the nearest whole unit.
d. gives the same answer regardless of the direction of change.
安全理财ANSWER: d. gives the same answer regardless of the direction of change.
TYPE: M KEY1: D SECTION: 1 OBJECTIVE: 2 RANDOM: Y
关于幸福的素材. Demand is elastic if elasticity is
a. equal to 1.
b. equal to 0.
c. less than 1.
d. greater than 1.
ANSWER: d. greater than 1.
TYPE: M KEY1: D SECTION: 1 OBJECTIVE: 2 RANDOM: Y
NOTE: THE FOLLOWING QUESTION IS REPEATED FROM THE ON-LINE QUIZZES. YOUR STUDENTS MAY HAVE ALREADY SEEN THIS QUESTION AND ITS ANSWER.
. A demand curve that is a downward-sloping straight line will have
a. a positive slope.
b. higher elasticity at the top than at the bottom.
c. lower elasticity at the top than at the bottom.
d. constant elasticity throughout its length.
ANSWER: b. higher elasticity at the top than at the bottom.虎牙长什么样
TYPE: M KEY1: D SECTION: 1 OBJECTIVE: 2 RANDOM: Y
. When the price of Pokemon cards are $.50, the quantity demanded is 400 cards per day. When the price falls to $.40, the quantity demanded increas to 600. Given this information and using the midpoint method, you know that the demand for Pokemon cards is
a. elastic.
b. inelastic.
c. unit elastic.
d. perfectly inelastic.
ANSWER: a. elastic.
TYPE: M KEY1: E SECTION: 2 OBJECTIVE: 3 RANDOM: Y
. A perfectly inelastic demand is
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a. vertical becau buyers purcha the same amount whether the price ris or falls.
b. negatively sloped becau buyers decrea their purchas when the price ris.
c. positively sloped becau buyers respond by increasing their purchas when price ris.
d. horizontal becau buyers increa their purchas by huge amounts with slight changes in price.
ANSWER: a. vertical becau buyers purcha the same amount whether the price ris or falls.
TYPE: M KEY1: D SECTION: 1 OBJECTIVE: 2 RANDOM: Y
