Question

A 10 percent increase in the price of soda leads to a 20 percent increase in the quantity of iced tea demanded. It appears that:

a) elasticity of demand for soda 0.5 and is inelastic.

b) elasticity of demand for iced tea is 2 and is elastic.

c) cross-price elasticity of demand for soda is -0.5.

d) cross-price elasticity of demand for iced tea is 2.

Answer #1

Option D

- Cross price elasticity of demand refers to the responsiveness of a good's demand with respect to the changes in the price of another good and It is calculated as the percentage in quality of a good divided by percentage in price of another good.
- Here it is said that the quantity of iced tea demanded = 20% and the price of soda = 10%.
- The price elasticity of demand is given by,

PED = % Q / % P

= 20 / 10

= 2.//

Therfore, the cross price elasticity of demand for iced tea is 2.

5. Suppose that Bobo purchases 1 pizza per month when the price
is $19 and 3 pizzas per month when the price is $15. What is the
price elasticity of Bobo’s demand curve?
Multiple Choice
a.0.235
b.2.00
c.4.25
d.6.33
6. Suppose that Mimi plays golf 5 times per month when the price
is $40 and 4 times per month when the price is $50. What is the
price elasticity of Mimi’s demand curve?
Multiple Choice
a.0.1
b.0.8
c.10.0
d.1.0
7....

8.
When the price increases by 30 percent and the quantity demanded
drops by 30 percent, the price elasticity of demand is
unitary elastic.
elastic.
perfectly inelastic.
inelastic.
perfectly inelastic.
9.
If the cross-price elasticity of demand between Good A and Good
B is 2 and the percentage change in price of Good A is 5 percent,
what is the percentage change in quantity demanded of Good B?
-3 percent
1.50 percent
10 percent
3 percent
-1.25 percent

In Market A, a 4 percent increase in price reduces the quantity
demanded by 2 percent. In Market B, a 3 percent increase in price
reduces the quantity demanded by 4 percent. The demand in Market A
and Market B are considered______ and _______, respectively.
a) unit price-elastic; perfectly price-inelastic.
b) price-elastic; price-inelastic.
c) perfectly price-elastic; unit price-elastic.
d) price-inelastic; price-elastic.

Q1: If a 10 percent rise in the price of coffee
increases the quantity of tea demanded by 25 percent and decreases
the quantity of coffee demanded by 20 percent,
Calculate price elasticity of coffee
Q2:
Calculate the cross-elasticity of demand between coffee
and tea.

A price change causes the quantity demanded for a good to
increase by 20 percent and the total revenue of that good decreases
by 15 percent. What can you say about the price elasticity of
demand at this point.
It's elastic
It's inelastic
It's unitary elastic
It's perfectly elastic

Hello,
Is it possible to get additional assistance on these
questions? This is a remedial class I am taking and my
classmates/professor havent been the greatest support.
1. Calculate the price elasticity of demand where a 10 percent
change in price leads to a 5 percent change in quantity demanded.
Is Ed elastic or inelastic?
2. Calculate the price elasticity of demand where a 7 percent
change in price leads to a 21 percent change in quantity demanded.
Is Ed...

(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...

If a 5 percent reduction in the price of coffee leads quantity
demanded for coffee to increase by 10 percent, demand is:
A.Elastic
B.Perfectly elastic
c.inelastic
D.unit elastic

A price change causes the quantity demanded of a good to
increase by 20 percent, while the total revenue of that good
increases by 15 percent. Is the demand curve elastic or inelastic?
Explain.

When the price of good "X" increases 20 percent (+20%), Harry
decreases his quantity demanded of "X" by 25 percent while Meghan
decreases her quantity demanded of "X" by 15 percent. Harry's
demand for good "X" is (relatively inelastic / unitary elastic /
relatively elastic) and Meghan's demand for good "X" is (relatively
inelastic / unitary elastic / relatively elastic).
A. Relatively inelastic; relatively
inelastic.
B. Relatively inelastic; relatively
elastic.
C. Unitary elastic; relatively
elastic.
D. Relatively elastic; relatively
elastic.

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