question
the law of supply states that, all other things being equal,
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the quantity supplied falls when the price falls, and the quantity supplied rises when the price rises
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when supply shifts to the right and demand stays constant, the equilibrium price and quantity
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increases
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Spam is considered an inferior good. What would happen to the equilibrium price and quantity of Spam if income decreased and more firms started producing Spam?
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Equilibrium price will be indeterminate and equilibrium quantity will go up
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when both supply and demand decrease, the equilibrium price and quantity
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is indeterminate; decreases
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price elasticity of demand is always
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positive
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When the price elasticity of demand is -0.6, then a ________ increase in price leads to a ________ in quantity demanded.
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10%; 6% decrease
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When the demand curve is vertical
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the price elasticity of demand is equal to zero
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As we move right along a demand curve, the price elasticity of demand
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becomes more inelastic
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When the total revenue is unchanged despite the change in price, demand is
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unitary elastic
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When can a firm lower prices and still increase revenue?
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when the demand is elastic
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Super Economy Brand products have an income elasticity of -1.4. Thus, these are ________ goods.
answer
inferior
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What good is most likely to have a negative income elasticity of demand?
answer
instant noodles
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A vertical supply curve can be described as
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perfectly inelastic
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