Elasticity

The price elasticity of demand measures how much

• quantity demanded responds to a change in price.
• quantity demanded responds to a change in income.
• price responds to a change in demand.
• demand responds to a change in supply.

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 tangerines

• Demand for fruit

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

• Demand for Exxon gasoline at the corner of 7th and Grand

• Demand for gasoline in the entire city

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

• Demand for insulin

• Demand for vitamins

During the COVID 19 Pandemic we are all experiencing now, and the information campaign from the Center for Disease Control highlighting that bacteria and other organisms cause and spread disease, will the demand curve for soap be more elastic or more inelastic?

• More elastic

• More inelastic

After the invention of nuclear power plants, will the demand curve for coal power plants be more elastic or more inelastic?

• More elastic

• More inelastic

After an economic boom, will the demand curve for TVs be more elastic or more inelastic?

• More elastic

• More inelastic