Year 10 Economics Chapter 7 -12 Quiz

Suppose that elasticity of demand of socks is 0.7.  If the price of socks is reduced by 10%, how will sales be effected?

• sales will grow by more than 10%
• Sales will grow by 10%
• Sales will grow by less than 10%
• Sales will decrease by 10%

The formula for calculating elasticity of demand is:

• The % change in price over the % change in quantity demanded
• The % change in quantity demanded over the % change in price
• The change in price over the change in quantity demaned
• The change in quantity demanded over the change in price

The elasticity of demand for tissues is 0.66. This means the demand for tissues is

• elastic
• unit elastic
• inelastic
• really expensive

Which of these best describes the law of demand with other factors equal?

• if prices go up, quantity demanded will fall and if prices go down, quantity demanded will go up

• if prices go up, quantity demanded will also go up and if prices go down, quantity demanded will also go down

• there is no law of demand, each situation is unique and demand and prices cannot be predicted

• prices will go up for certain goods when quantity demanded goes up and vice versa

Elasticity refers to

• how producers of goods and services react to price changes

• how consumers of goods and services react to price changes

• how far a supply of scarce goods can be stretched

• how often the price of a good or service changes when quantity demanded changes

Wheat has seen a decrease in demand of 5%, while the price has increased 7%

• 1.4 inelastic

• 1.4 elastic

• .71 inelastic

• .71 elastic

A complement example would be all except

• butter and margarine 
• peanut-butter and jelly
• flashlight and batteries 
• cameras and film 

An increase in the number of consumers can cause 

• the demand curve to shift left
• the demand curve to shift right 
• the demand curve to shift up
• diminishing returns 

Products that tend to be used together 

• complements 
• substitutes
• goods
• needs 

Describes very little a change in demand with a large change in price 

• elastic 
• inelastic 
• demand curve 
• price