1. Clothing retailers often use sales, where some or all products are sold at a discount price, to increase revenue. What does this suggest about the price elasticity of demand for retail clothing?
A) It is elastic.
B) It is inelastic.
C) It is unit elastic.
D) This tells us nothing about elasticity.
2. If demand is inelastic, then increasing price will do what to revenue?
A) It is impossible to say.
B) Decrease
C) Increase
D) Nothing will happen to revenue.
3. If P increases from 200 to 202 and Qd decreases from 50 to 49, what is the price elasticity of demand? ___
4. If elasticity (i.e. price elasticity of demand) is -3, a 1.5% increase in price would lead to what change in quantity demanded?
A) a decrease of 3%
B) a decrease of 4.5%
C) an increase of 1.5%
D) an increase of 3%
5. If you know that the demand curve is given by: Q = 20-2P What is the price elasticity of demand if P = 4?
A) -0.666
B) -0.33
C) -1.33
D) -1.66
1. Clothing retailers often use sales, where some or all products are sold at a discount price, to increase revenue. What does this suggest about the price elasticity of demand for retail clothing?
A) It is elastic.
B) It is inelastic.
C) It is unit elastic.
D) This tells us nothing about elasticity.
2. If demand is inelastic, then increasing price will do what to revenue?
A) It is impossible to say.
B) Decrease
C) Increase
D) Nothing will happen to revenue.
3. If P increases from 200 to 202 and Qd decreases from 50 to 49, what is the price elasticity of demand? ___
4. If elasticity (i.e. price elasticity of demand) is -3, a 1.5% increase in price would lead to what change in quantity demanded?
A) a decrease of 3%
B) a decrease of 4.5%
C) an increase of 1.5%
D) an increase of 3%
5. If you know that the demand curve is given by: Q = 20-2P What is the price elasticity of demand if P = 4?
A) -0.666
B) -0.33
C) -1.33
D) -1.66
