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ECON 102 Quiz: ECON102 Quiz 4 2017

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turquoisegnu128
28 Sep 2018
School
PSU
Department
Economics
Course
ECON 102
Professor
All

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ECON 102 Full Course Notes
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The price elasticity of demand measures the responsiveness of quantity demanded to a change in. Correct! a good"s own price consumer income consumer tastes the price of a competing product. The price elasticity of demand measures the magnitude of the change in quantity demanded resulting from a change in price. Demand tends to be more elastic in more broadly defined markets. Correct answer when there are many substitutes available when the good is a necessity. Goods that have many available substitutes have relatively elastic demands. Between points a and b, the slope of the demand curve is ______ and the elasticity is ________ in absolute value. Use the midpoint method to calculate the price elasticity of demand. Correct! a b c all are equally elastic. The steeper the curve, the less elastic it is. As price falls, the slope along this demand curve is ________, and the price elasticity is _________ in absolute value. falling, constant.

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Related Questions

Discussion #1

The law of demand states that a fall in the price of a good raises the quantity demanded, and the increase in price leads to a decrease in quantity demanded. The price elasticity of demand measures the responsiveness of the quantity demanded to a change in price. Demand for a good is said to be elastic if the quantity demanded responds substantially to changes in the price, and the percentage change in quantity demanded is greater than the percentage change in price. Demand is said to be inelastic if the quantity demanded responds only slightly to changes in the price, which indicates that the percentage in price is greater than the percentage in quantity demanded.

However, the extent of responsiveness of quantity demanded to a change in price depends on the nature of a particular good or service in the market. The price elasticity of demand partly depends on the availability of close substitutes. When a large number of substitutes are available, consumers respond to a higher price of a good by buying more of the substitute goods and less of the relatively more expensive good. In addition, goods or services that are considered necessities tend to have less elastic (more inelastic) demand, whereas goods or services that are considered luxuries have more elastic (less inelastic) demands.

  • Explain why the demand for the good or service provided by the organization you work for is elastic or inelastic. How does this influence pricing decisions?
  • Provide examples on how the availability of close substitutes affects price elasticity of demand.
  • Give specific examples of necessities or luxuries, and explain how they affect price elasticity of goods or services.

Please answer ALL bulletins and place the answers under the correct bulletin.

27. Which of the following statements is correct? a. The greater the price elasticity of demand, the more likely the product is a necessity. b. The greater the price elasticity of demand, the smaller the responsiveness of quanti demanded to price. The greater the price elasticity of demand, the greater the percentage change in price over the percentage change in quantity demanded. d. The greater the price elasticity of demand, the greater the responsiveness of quantity demanded to price.

which of the following statements about price elasticity of demand is​ true?
A.The price elasticity of demand for a good measures the willingness of buyers of the good to buy less of the good as its price increases.
B.Price elasticity of demand reflects the many economic, psychological, and social forces that shape consumer tastes.
C.Other things equal, if good x has close substitutes and good y does not have close substitutes, then the demand for good x will be more elastic than the demand for good y.
D. All of the above are correct.