Question 1

Suppose a market has the demand function Qd=20-0.5P.Using the midpoint method,what is the price elasticity of demand between $30 and $40?

Accepted Answer

7

Question 2

With regard to elasticity,if a firm has a longer time to adjust to a price increase,supply will be more

Accepted Answer

The answer of With regard to elasticity,if a firm has...

Question 3

If the income elasticity of demand for a good is 0.56,is the good a normal or inferior good?

Accepted Answer

The good i...

Question 4

Adam and Barb go to the store to purchase some lottery tickets.Without looking at the price,Adam says "I'll take 10 lottery tickets," and Barb says "I'll take $10 worth of lottery tickets." What is each person's price elasticity of demand for lottery tickets?

Accepted Answer

Since Adam wants 10 tickets regardless o...

Question 5

If the cross-price elasticity of demand between two goods is negative,what is the relationship between the two goods?

Accepted Answer

The goods ...

Question 6

If the cross-price elasticity of demand between two goods is positive,what is the relationship between the two goods?

Accepted Answer

The goods ...

Question 7

Suppose that good X has few close substitutes and that good Y has many close substitutes.Which good would you expect to have more price inelastic demand?

Accepted Answer

The answer of Suppose that good X has few close...

Question 8

Suppose demand is given by the equation:

At what price will total revenue be maximized?

Accepted Answer

Total revenue will be maximize...

Question 9

Recently,in Smalltown,the price of Twinkies fell from $0.80 to $0.70.As a result,the quantity demanded of Ho-Ho's decreased from 120 to 100.What would be the appropriate elasticity to compute? Using the midpoint method,compute this elasticity.What does your answer tell you?

Accepted Answer

The appropriate elasticity to compute wo...

Question 10

With regard to elasticity,as a firm nears its production capacity,supply becomes more

Accepted Answer

The answer of With regard to elasticity,as a firm nears...

Question 11

Suppose the price elasticity of demand for a product is 0.5.If a supplier wants to increase revenue,what change should it make to price,if any?

Accepted Answer

The answer of Suppose the price elasticity of demand for...

Question 12

Suppose that good X has few close substitutes and that good Y has many close substitutes.Which good would you expect to have more price elastic demand?

Accepted Answer

The answer of Suppose that good X has few close...

Question 13

Scenario 5-6
Consider the markets for mobile and landline telephone service.Suppose that when the average income of residents of Plainville is $55,000 per year,the quantity demanded of landline telephone service is 12,500 and the quantity demanded of mobile service is 28,000.Suppose that when the price of mobile service rises from $100 to $120 per month,the quantity demanded of landline service decreases to 11,000.Suppose also that when the average income increases to $60,000,the quantity demanded of mobile service increases to 33,000.
-Refer to Scenario 5-6.Considering the income elasticity,what type of good is mobile telephone service?

Accepted Answer

The answer of Scenario 5-6
Consider the markets for mobile and...

Question 14

Suppose demand is given by the equation:

Using the midpoint method,what is the price elasticity of demand between $1 and $2?

Accepted Answer

The price elasticity of demand is 0.18.

Question 15

In the short run,as compared to the long run,both the price elasticity of demand and the price elasticity of supply tend to be more

Accepted Answer

The answer of In the short run,as compared to the...

Question 16

Figure 5-21 
-Refer to Figure 5-21.Using the midpoint method,what is the price elasticity of supply between $15 and $25?

Accepted Answer

The price ...

Question 17

Scenario 5-6
Consider the markets for mobile and landline telephone service.Suppose that when the average income of residents of Plainville is $55,000 per year,the quantity demanded of landline telephone service is 12,500 and the quantity demanded of mobile service is 28,000.Suppose that when the price of mobile service rises from $100 to $120 per month,the quantity demanded of landline service decreases to 11,000.Suppose also that when the average income increases to $60,000,the quantity demanded of mobile service increases to 33,000.
-Refer to Scenario 5-6.Using the midpoint method,what is the cross price elasticity of demand for landline and mobile service?

Accepted Answer

The answer of Scenario 5-6
Consider the markets for mobile and...

Question 18

Suppose a freeze in Florida significantly reduces the supply of oranges this year.As a result,would you expect the total revenue from the sale of orange juice to rise or fall? Explain.

Accepted Answer

Since oranges are an input into the prod...

Question 19

Figure 5-21 
-Refer to Figure 5-21.Using the midpoint method,what is the price elasticity of supply between $5 and $15?

Accepted Answer

The price ...

Question 20

Scenario 5-6
Consider the markets for mobile and landline telephone service.Suppose that when the average income of residents of Plainville is $55,000 per year,the quantity demanded of landline telephone service is 12,500 and the quantity demanded of mobile service is 28,000.Suppose that when the price of mobile service rises from $100 to $120 per month,the quantity demanded of landline service decreases to 11,000.Suppose also that when the average income increases to $60,000,the quantity demanded of mobile service increases to 33,000.
-Refer to Scenario 5-6.Considering the cross price elasticity of demand for mobile and landline telephone service,is the cross price elasticity of demand positive or negative and do the consumers of Plainville regard these goods as substitutes or complements?

Accepted Answer

The cross price elasticity of demand is negative and consumers regard the two goods as complements.

Exam 5: Elasticity and Its Applications: Part A

Suppose a market has the demand function Q^d=20-0.5P.Using the midpoint method,what is the price elasticity of demand between $30 and $40?

Correct Answer
verified
7

With regard to elasticity,if a firm has a longer time to adjust to a price increase,supply will be more

Correct Answer
verified

If the income elasticity of demand for a good is 0.56,is the good a normal or inferior good?

Correct Answer
verified
The good i...
View Answer

Adam and Barb go to the store to purchase some lottery tickets.Without looking at the price,Adam says "I'll take 10 lottery tickets," and Barb says "I'll take $10 worth of lottery tickets." What is each person's price elasticity of demand for lottery tickets?

Correct Answer
verified
Since Adam wants 10 tickets regardless o...
View Answer

If the cross-price elasticity of demand between two goods is negative,what is the relationship between the two goods?

Correct Answer
verified
The goods ...
View Answer

If the cross-price elasticity of demand between two goods is positive,what is the relationship between the two goods?

Correct Answer
verified
The goods ...
View Answer

Suppose that good X has few close substitutes and that good Y has many close substitutes.Which good would you expect to have more price inelastic demand?

Correct Answer
verified

Suppose demand is given by the equation: At what price will total revenue be maximized?

Correct Answer
verified
Total revenue will be maximize...
View Answer

Recently,in Smalltown,the price of Twinkies fell from $0.80 to $0.70.As a result,the quantity demanded of Ho-Ho's decreased from 120 to 100.What would be the appropriate elasticity to compute? Using the midpoint method,compute this elasticity.What does your answer tell you?

Correct Answer
verified
The appropriate elasticity to compute wo...
View Answer

With regard to elasticity,as a firm nears its production capacity,supply becomes more

Correct Answer
verified

Suppose the price elasticity of demand for a product is 0.5.If a supplier wants to increase revenue,what change should it make to price,if any?

Correct Answer
verified

Suppose that good X has few close substitutes and that good Y has many close substitutes.Which good would you expect to have more price elastic demand?

Correct Answer
verified

Correct Answer
verified

Suppose demand is given by the equation: Using the midpoint method,what is the price elasticity of demand between $1 and $2?

Correct Answer
verified
The price elasticity of demand is 0.18.

In the short run,as compared to the long run,both the price elasticity of demand and the price elasticity of supply tend to be more

Correct Answer
verified

Figure 5-21 -Refer to Figure 5-21.Using the midpoint method,what is the price elasticity of supply between $15 and $25?

Correct Answer
verified
The price ...
View Answer

Correct Answer
verified

Suppose a freeze in Florida significantly reduces the supply of oranges this year.As a result,would you expect the total revenue from the sale of orange juice to rise or fall? Explain.

Correct Answer
verified
Since oranges are an input into the prod...
View Answer

Figure 5-21 -Refer to Figure 5-21.Using the midpoint method,what is the price elasticity of supply between $5 and $15?

Correct Answer
verified
The price ...
View Answer

Correct Answer
verified
The cross price elasticity of demand is negative and consumers regard the two goods as complements.

Exam 5: Elasticity and Its Applications: Part A

Suppose a market has the demand function Qd=20-0.5P.Using the midpoint method,what is the price elasticity of demand between $30 and $40?

Correct Answerverified7

With regard to elasticity,if a firm has a longer time to adjust to a price increase,supply will be more

Correct AnswerverifiedShow Answer

If the income elasticity of demand for a good is 0.56,is the good a normal or inferior good?

Correct AnswerverifiedThe good i...View AnswerShow Answer

Adam and Barb go to the store to purchase some lottery tickets.Without looking at the price,Adam says "I'll take 10 lottery tickets," and Barb says "I'll take $10 worth of lottery tickets." What is each person's price elasticity of demand for lottery tickets?

Correct AnswerverifiedSince Adam wants 10 tickets regardless o...View AnswerShow Answer

If the cross-price elasticity of demand between two goods is negative,what is the relationship between the two goods?

Correct AnswerverifiedThe goods ...View AnswerShow Answer

If the cross-price elasticity of demand between two goods is positive,what is the relationship between the two goods?

Correct AnswerverifiedThe goods ...View AnswerShow Answer

Suppose that good X has few close substitutes and that good Y has many close substitutes.Which good would you expect to have more price inelastic demand?

Correct AnswerverifiedShow Answer

Suppose demand is given by the equation: At what price will total revenue be maximized?

Correct AnswerverifiedTotal revenue will be maximize...View AnswerShow Answer

Recently,in Smalltown,the price of Twinkies fell from $0.80 to $0.70.As a result,the quantity demanded of Ho-Ho's decreased from 120 to 100.What would be the appropriate elasticity to compute? Using the midpoint method,compute this elasticity.What does your answer tell you?

Correct AnswerverifiedThe appropriate elasticity to compute wo...View AnswerShow Answer

With regard to elasticity,as a firm nears its production capacity,supply becomes more

Correct AnswerverifiedShow Answer

Suppose the price elasticity of demand for a product is 0.5.If a supplier wants to increase revenue,what change should it make to price,if any?

Correct AnswerverifiedShow Answer

Suppose that good X has few close substitutes and that good Y has many close substitutes.Which good would you expect to have more price elastic demand?

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

Suppose demand is given by the equation: Using the midpoint method,what is the price elasticity of demand between $1 and $2?

Correct AnswerverifiedThe price elasticity of demand is 0.18.

In the short run,as compared to the long run,both the price elasticity of demand and the price elasticity of supply tend to be more

Correct AnswerverifiedShow Answer

Figure 5-21 -Refer to Figure 5-21.Using the midpoint method,what is the price elasticity of supply between $15 and $25?

Correct AnswerverifiedThe price ...View AnswerShow Answer

Correct AnswerverifiedShow Answer

Suppose a freeze in Florida significantly reduces the supply of oranges this year.As a result,would you expect the total revenue from the sale of orange juice to rise or fall? Explain.

Correct AnswerverifiedSince oranges are an input into the prod...View AnswerShow Answer

Figure 5-21 -Refer to Figure 5-21.Using the midpoint method,what is the price elasticity of supply between $5 and $15?

Correct AnswerverifiedThe price ...View AnswerShow Answer

Correct AnswerverifiedThe cross price elasticity of demand is negative and consumers regard the two goods as complements.

Suppose a market has the demand function Q^d=20-0.5P.Using the midpoint method,what is the price elasticity of demand between $30 and $40?

Correct Answer
verified
7

Correct Answer
verified

Correct Answer
verified
The good i...
View Answer

Correct Answer
verified
Since Adam wants 10 tickets regardless o...
View Answer

Correct Answer
verified
The goods ...
View Answer

Correct Answer
verified
The goods ...
View Answer

Correct Answer
verified

Correct Answer
verified
Total revenue will be maximize...
View Answer

Correct Answer
verified
The appropriate elasticity to compute wo...
View Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified
The price elasticity of demand is 0.18.

Correct Answer
verified

Correct Answer
verified
The price ...
View Answer

Correct Answer
verified

Correct Answer
verified
Since oranges are an input into the prod...
View Answer

Correct Answer
verified
The price ...
View Answer

Correct Answer
verified
The cross price elasticity of demand is negative and consumers regard the two goods as complements.