Econ Quiz 5

What is Elasticity of demand

• Measures how responsive the quantity demanded is to a
  change in price

• d

What are the determinants of elasticity of demand?

• substitutes

  price change

  commodity

• Luxuries

  Share of budget

What item would be the most inelastic given the list?

Potato chips and a pack of gum

• the pack of gum would be more inelastic because it takes the smallest share of your budget

• n

What do lots of substitutes mean for elasticity?

• It means it’s more elastic

• g

What is the determinant that makes something more elastic?

• Lots of substitutes make something more elastic less substitutes makes something less elastic

  
  

• s

What do lots of substitutes mean for the determinants of elasticity of demand?

• It's elastic

• 3

What do Very few substitutes mean for the determinants of elasticity of demand?

• It's inelastic

• v

If a product on the supply side is inelastic and there is a large change in price, what is the proportion change in quantity supply?

• It’s smaller

• j

Is there a perfectly elastic supply curve?

• Yes

• k

If you can expand production and not increase the overall demand for inputs, what is the supply? 

• It’s elastic

• 8