Question 1

The quantity demanded increases from 20 to 30 units as the price falls from 50 to 40.What is the price elasticity of demand using the arc (or midpoint)  method?

Accepted Answer

A)  -1/5
B)  -9
C)  -1/2
D)  -9/5
E)  NoneF) B) and E)
G) A) and E) D

Question 2

If the quantity supplied increases from 100 to 150 if the price rises from 5 to 10, what is the price elasticity of supply according to the arc (or midpoint)  method?

Accepted Answer

A)  1/5
B)  2/5
C)  3/5
D)  1
E)  None of the aboveF) C) and D)
G) All of the above

Question 3

If an increase in income by 15 per cent results in a 45 per cent increase in the quantity demanded, what is the income elastic of the good?

Accepted Answer

A)  3/2
B)  3
C)  1/2
D)  1/3
E)  None of the aboveF) A) and B)
G) A) and C)

Question 4

Which statement is true?

Accepted Answer

A)  The cross-price elasticity of demand for two substitute products is zero.
B)  The cross-price elasticity of demand for two substitute products is negative.
C)  The cross-price elasticity of demand for two substitute products is positive.
D)  Either a or BE) A) and D)
F) B) and D) C

Question 5

Consider a market with a demand curve of P = 150 - q and a supply curve of P = 2q.What is the price elasticity of demand at the market equilibrium?

Accepted Answer

A)  -1/2
B)  -1
C)  -3/2
D)  -2
E)  None of the aboveF) C) and E)
G) A) and E)

Question 6

Consider a market with a demand curve of P = 150 - q and a supply curve of P = 2q.What is the price elasticity of supply at the market equilibrium?

Accepted Answer

A)  1/2
B)  1
C)  3/2
D)  2
E)  None of the aboveF) A) and B)
G) B) and C)

Question 7

A company that supplies water to a city faces a market demand curve of P = 240 - 3q.At what quantity does the company maximize total revenue?

Accepted Answer

A)  q = 20
B)  q = 40
C)  q = 60
D)  q = 80
E)  None of the aboveF) A) and D)
G) A) and B)

Question 8

A company that supplies water to a city faces a market demand curve of P = 150 - 2q.At what price does the company maximize total revenue?

Accepted Answer

A)  P = 75
B)  P = 150
C)  P = 50
D)  P = 100
E)  None of the above.F) A) and C)
G) A) and D) A

Question 9

What is the price elasticity of supply if the supply curve is given by P = 2q?

Accepted Answer

A)  1
B)  2
C)  3
D)  4
E)  None of the aboveF) B) and E)
G) A) and C)

Question 10

Which statement is true?

Accepted Answer

A)  The price elasticity of demand is constant along a straight-line demand curve.
B)  The price elasticity of demand varies along a straight-line demand curve.
C)  Given slope is constant, the price elasticity of demand is constant along a straight-line demand curve.
D)  a and c
E)  None of the above.F) D) and E)
G) A) and B)

Exam 10: Elasticity

The quantity demanded increases from 20 to 30 units as the price falls from 50 to 40.What is the price elasticity of demand using the arc (or midpoint) method?

Correct Answer
verified
D

If the quantity supplied increases from 100 to 150 if the price rises from 5 to 10, what is the price elasticity of supply according to the arc (or midpoint) method?

Correct Answer
verified

If an increase in income by 15 per cent results in a 45 per cent increase in the quantity demanded, what is the income elastic of the good?

Correct Answer
verified

Which statement is true?

Correct Answer
verified
C

Consider a market with a demand curve of P = 150 - q and a supply curve of P = 2q.What is the price elasticity of demand at the market equilibrium?

Correct Answer
verified

Consider a market with a demand curve of P = 150 - q and a supply curve of P = 2q.What is the price elasticity of supply at the market equilibrium?

Correct Answer
verified

A company that supplies water to a city faces a market demand curve of P = 240 - 3q.At what quantity does the company maximize total revenue?

Correct Answer
verified

A company that supplies water to a city faces a market demand curve of P = 150 - 2q.At what price does the company maximize total revenue?

Correct Answer
verified
A

What is the price elasticity of supply if the supply curve is given by P = 2q?

Correct Answer
verified

Which statement is true?

Correct Answer
verified

Exam 10: Elasticity

The quantity demanded increases from 20 to 30 units as the price falls from 50 to 40.What is the price elasticity of demand using the arc (or midpoint) method?

Correct AnswerverifiedD

If the quantity supplied increases from 100 to 150 if the price rises from 5 to 10, what is the price elasticity of supply according to the arc (or midpoint) method?

Correct AnswerverifiedShow Answer

If an increase in income by 15 per cent results in a 45 per cent increase in the quantity demanded, what is the income elastic of the good?

Correct AnswerverifiedShow Answer

Which statement is true?

Correct AnswerverifiedC

Consider a market with a demand curve of P = 150 - q and a supply curve of P = 2q.What is the price elasticity of demand at the market equilibrium?

Correct AnswerverifiedShow Answer

Consider a market with a demand curve of P = 150 - q and a supply curve of P = 2q.What is the price elasticity of supply at the market equilibrium?

Correct AnswerverifiedShow Answer

A company that supplies water to a city faces a market demand curve of P = 240 - 3q.At what quantity does the company maximize total revenue?

Correct AnswerverifiedShow Answer

A company that supplies water to a city faces a market demand curve of P = 150 - 2q.At what price does the company maximize total revenue?

Correct AnswerverifiedA

What is the price elasticity of supply if the supply curve is given by P = 2q?

Correct AnswerverifiedShow Answer

Which statement is true?

Correct AnswerverifiedShow Answer

Correct Answer
verified
D

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified
C

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified
A

Correct Answer
verified

Correct Answer
verified