ECON 1 Study Guide - Midterm Guide: Demand Curve, Inferior Good, Complementary Good

70 views1 pages

turquoisegnu128

15 Oct 2018

School

Department

Course

Professor

For unlimited access to Study Guides, a Grade+ subscription is required.

Document Summary

If we are currently at point a on the demand curve, which has a y-coordinate of 10, an x-coordinate of 4, and a slope of - 5, then price elasticity of demand is: -0. 5, -0. 125, -0. 08, -5. The higher the price, demand is: more inelastic, unit elastic, more elastic, none of the above. Demand is more elastic when: the good has fewer substitutes, the good constitutes a large share of the budget, the market has a shorter time to adjust to a price change, the good is a necessity. When demand is elastic, an increase in price results in: an increase in revenue, revenue stays the same, a decrease in revenue, none of the above. When cross price elasticity of demand is positive, then the good in question is a: normal good, inferior good, complementary good, substitute good.

Related Questions

If the percentage change in the quantity demanded of a good is less than the percentage change in price, the price elasticity of demand is:

A) Elastic

B) Inelastic

C) Perfectly inelastic

D) Unitary elastic

byzantiummole828

interval (or arc) elasticity

cross-price elasticity

price elasticity of demand

elastic demand

income elasticity

inelastic demand

inframarginal units

marginal revenue

point elasticity

price effect

quantity effect

total revenue

unitary elastic demand

1. __________________ A measure of consumersâ sensitivity or responsiveness to changes in the price of a good or service.

2. ___________________ When the percentage change in price (in absolute value) is more than the percentage change in quantity demanded (in absolute value).

3. ___________________ When the percentage change in quantity demanded (in absolute value) is more than the percentage change in price (in absolute value).

4. ___________________ When the percentage change in quantity demanded (in absolute value) is just equal to the percentage change in price (in absolute value).

5. ___________________ Total amount paid to a producer for a good or service P * Q.

6. ___________________ The effect on total revenue of a change in price, holding quantity constant.

7. ___________________ The effect on total revenue of a change in quantity, holding price constant.

8. ___________________ An elasticity calculated over an interval of a demand curve or demand schedule.

9. ___________________ Elasticity at a specific price or point on a demand curve.

10. ___________________ A measure of how responsive quantity demanded is to a change in income, all other things constant.

11. ___________________ A measure showing how responsive the quantity demanded of one good is to changes in the price of another good, other factors constant.

12. ___________________ The additional revenue received by producing and selling one more unit of output.

13. ___________________ Units of output that could have been sold at a higher price had the firm not lowered its price to sell additional (marginal) units.

coffeehornet269

1. The concept of price elasticity of demand measures:

a. the slope of the demand curve.

b. the number of buyers in a market.

c. the extent to which the demand curve shifts as the result of a price decline.

d. the sensitiveness of quantities demanded to price changes.

2. When the percentage change in price is less than the resulting percentage change in quantity demanded:

a. demand is elastic.

b. demand is inelastic.

c. demand is unit elastic.

d. none of the above.

3. The elasticity of demand:

a. will be the same at each price-quantity combination on a stable demand curve.

b. tends to be elastic in high-price ranges and inelastic in low-price ranges.

c. tends to be inelastic in high-price ranges and elastic in low-price ranges.

d. is infinitely large for a perfectly inelastic demand curve.

4. Suppose that as the price of Y falls from $2.00 to $1.80 the quantity of Y demanded increases from 110 to 121. It can be concluded that the price elasticity of demand is: _______.

5. Total revenue rises as the price of a good increases if price elasticity of demand is:

a. unitary elastic

b. perfectly inelastic.

6. The demand for such products as salt, bread, and electricity tend to be:

a. relatively price elastic.

b. relatively price inelastic.

c. of unit price elasticity.

d. perfectly price elastic.

coffeeelephant81

ECON 1 Study Guide - Midterm Guide: Demand Curve, Inferior Good, Complementary Good

Document Summary

Get access

Related Documents

ECON 1 Exam Solution: Price Ceiling, Economic Equilibrium, Price Floor

ECON 1 Study Guide - Midterm Guide: Economic Equilibrium, Normal Good, Absolute Advantage

ECON 1 Study Guide - Midterm Guide: Perfect Competition, Demand Curve

Related Questions