Elasticity of Demand

Describe your demand for a product if you buy the same amount of it or just a small amount less after a large price increase.

• elastic

• unitary elastic

• inelastic

• hyperelastic

Which of the following is an example of inelastic demand?

• Jason wants the most expensive cellphone. He decides to get a cheaper model.

• Priya wants to go to the season-opening game. Tickets to another game cost less, but she still buys tickets for the opener.

• Tianna wants to try out a new, expensive restaurant. She goes to another restaurant whose food is excellent and costs less.

• Shawn wants to buy a house in one neighborhood. But after searching, he decides to buy a house elsewhere instead.

How does elasticity affect potential revenue for a firm?

• If demand for a good is inelastic, lowering the price could raise revenue.

• If demand for a good is inelastic, raising the price could reduce revenue.

• If demand for a good is elastic, raising the price must increase revenue.

• If demand for a good is elastic, raising the price could reduce revenue.

Which of the following two goods is more likely to be inelastically demanded?

• Demand for insulin

• Demand for vitamins

Which is not one of the 5 shifters of Demand

• Tastes and Preferences

• Number of Consumers

• Income

• Expectations

• Taxes

When Demand increases the Demand Curve will shift which way ?

• Left

• Right

When Demand decrease the Demand curve will shift which way ?

• Left

• Right

When points move along the demand curve this is known as this ?

• Change in Demand

• Change in Quantity Demanded

If the Demand Curve shifts at every price level then you have a change in demand

• True

• False

More people usually means more or less demand ?

• More

• Less