Question

True/False Answer Following Questions.......16-. The demand for oil would become less elastic if the price of oil increases by significant amount for a long period of time. 17-. When demand is inelastic, total revenue goes down in proportion to a price increase. 18- Elasticity of demand is always negative. 19-. If the price of a good increases from $100 to $110 and quantity demanded decreases from 100 units to 90 units, the demand would be classified as unit elastic. 20- The elasticity of supply measures how sensitive the supply curve is to a change in price.

Answer #1

Answer : 16) False. Because in long run time period demand is more elastic than the short run time period as in long run all things are variable.

17 ) False. Because when demand is inelastic then there is no matter if price rise or not. This means in case of inelastic demand if price rise then total revenue increase.

18) True. Because there is an inverse relationship between price and quantity demanded. If price rise then demand decrease and if price fall then demand increase. Therefore, here exists negative elasticity.

19) True . In case of unit elasticity if price rise by 1% then demand decrease by 1% and vise versa. This means there is equal proportion change in price and quantity demanded.

20) True. Because if price rise then supply increase which shift the supply curve to rightward. If price fall then supply decrease which shift the supply curve to leftward.

A-TRUE/FALSE-....1-. The quantity demanded is the quantity that
consumers are willing and able to purchase at a given price. 2- A
vertical reading of the demand curve gives the maximum price per
unit that consumers are willing to pay for a particular quantity of
a good. 3- There are more substitutes for oil as a jet fuel than
for oil as a lubricant. 4-. An increase in income increases the
demand for normal goods. 5-. Producer surplus can be defined...

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When the price of t-shirts increases by 12 percent, the quantity
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A life-saving medicine without any close substitutes will tend
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a small elasticity of supply. a large elasticity of supply. The
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falls from 110 to 90 units. Calculated with the midpoint method,
the price elasticity of demand is 1/5. 1/2. 2. 5. A linear,
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1-As we move up the demand curve, the price elasticity of demand
* A) increases B) decreases C) becomes unitary D) does not
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2-If the price of lemonade increases relative to the price of
grape juice, the demand for: * A) grape juice will decrease. B)
grape juice will increase. C) lemonade will decrease. D) lemonade
will increase.
3-An increase in price will result in no change in total revenue
if: * A) the percentage change in price is...

3.
At the price of $20, the quantity demand of lawn hoses was 100.
The price increased to $25, and the quantity demanded dropped to
95.
[ The two points on the demand curve are Point A: (100, $20) and
Point B (95, $25).]
a) Calculate the price elasticity of
demand for the hoses. ____________
b) Is it elastic, inelastic or unitary
elastic? _____________
What happens to the total revenue in this
case?_______________
What would happen to the total revenue...

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Assume economists have determined that the price elasticity of
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A) True
B) False
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Taking the absolute value of the cross-price elasticity of
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remove the ability to tell whether the two products have
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cause the value of the cross-price elasticity of demand to
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remove the ability to tell whether the two products are
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cause the value of the cross-price elasticity of demand to
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The percent change in insulin demanded for any price change is
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