question
The price elasticity of demand for gasoline measures the:
answer
Responsiveness of customers to changes in the price of gasoline
question
Indicate if the following statement is True or False:
If the percentage change in the quantity demanded of a good is less than the percentage change in price, price elasticity of demand is elastic:
If the percentage change in the quantity demanded of a good is less than the percentage change in price, price elasticity of demand is elastic:
answer
False
question
If the price elasticity of demand for football tickets is estimated to be 4.5, then a 10 percent increase in football ticket prices would be expected to cause a:
answer
45 percent decrease in quantity demanded
question
Suppose the Pleasant Corporation Cuts the price of its American Girl dolls by 10 percent, and as a result, the quantity of the dolls sold increased by 25 percent. This indicates that the price elasticity of demand for the dolls over this range is:
answer
2.5
question
A completely elastic demand curve has an elasticity coefficient of:
answer
Infinity
question
Indicate if the following statement is True or False:
If the quantity demanded increases by 20 percent in response to a 10 percent decrease in price, then price elasticity of demand is elastic.
If the quantity demanded increases by 20 percent in response to a 10 percent decrease in price, then price elasticity of demand is elastic.
answer
True
question
The price elasticity of demand for a vertical demand curve is:
answer
Perfectly inelastic
question
In Exhibit 5-1, between points a and b, the price elasticity of demand measures:
answer
1.0
question
Using the midpoint formula, what would be price elasticity of demand for a gallbladder operation if the number of operations fell from 6,000 to 4,000 per week after its price increased from $6,000 to $10,000?
answer
0.80
question
If price is reduced and demand is price inelastic, then total revenue will:
answer
Decrease
question
Consider the market for automibles. IF a dealer cuts prices 10 percent and finds he sells 20 percent more cars, then demand for autos is _____ and his total revenue will ____.
answer
Elastic; rise
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