Question

(60)A perfectly inelastic demand curve has an elasticity coefficient of:

(a)1

(b)0.25

(c)∞

(d)None of the above

Akal mn wahed

Extra Credit Questions-Optional

(61)If the percentage change in the quantity supplied of a good is less than the percentage change in price, price elasticity of supply is:

(a)Inelastic

(b)Perfectly inelastic

(c)Elastic

(d)Unitary elastic

(62)If the percentage change in the quantity demanded of a good is equal to the percentage change in price, price elasticity of demand is:

(a)Inelastic

(b)Perfectly inelastic

(c)Elastic

(d)None of the above

(63)In order to prove that ginger tea and mint tea are substitutes, microeconomists should test the------------------------------and get a-------------------------------.

(a)Price elasticity of demand; positive number

(b)Price elasticity of supply; negative number

(c)Cross price elasticity of demand; positive number

(d)Income elasticity of demand; negative number

(64)Suppose that the quantity of oranges sold increases by 45 percent when the price of tangerines increases by 25 percent. What is the coefficient of cross price elasticity of demand for these fruits?

(a)2.5

(b)3.2

(c)1.8

(d)0.3

(65)Given the coefficient of cross price elasticity of demand for the fruits in Q#64 above, which of the following statements is true?

(a)They are complements

(b)Their demand curve is negatively sloped

(c)Their cross elasticity of demand is negative

(d)None of the above

(66)Which of the following statements is true?

In the very short run period:

(a)The price elasticity of supply is very elastic

(b)The price elasticity of demand is very elastic

(c)The price elasticity of supply is very inelastic

(d)Income elasticity of demand is perfectly elastic

(67)Suppose that when the price of cherries is $10 per lb, the quantity supplied of cherries is 20 lbs. When price of cherries is $6 per lb, the quantity supplied of cherries is 12 lbs. The price elasticity of supply is:

(a)1.7

(b)1.0

(c)2.5

(d)0.8

Answer 1

(60)A perfectly inelastic demand curve has an elasticity coefficient of:

(d)None of the above as Perfectly inelastic is equal to 0

(61)If the percentage change in the quantity supplied of a good is less than the percentage change in price, price elasticity of supply is:

(a)Inelastic

(62)If the percentage change in the quantity demanded of a good is equal to the percentage change in price, price elasticity of demand is:

(d)None of the above as it is equal to 1

(63)In order to prove that ginger tea and mint tea are substitutes, microeconomists should test the cross price elasticity of demand and which is always positive in case of substitutes as an increase in the price of one good leads to an increase in demand for its substitute.

(c)Cross price elasticity of demand; positive number