Chapter 5 review

Fill in the blank: _________ has an inelastic demand because it is a _______.

• Steak, luxury

• Public transit, necessity

• Steak, necessity

• 1. Public transit, luxury 

Gala apples have an:

• Elastic supply, elastic demand

• Elastic supply, inelastic demand

• Inelastic supply, elastic demand

• Inelastic supply, inelastic demand

If price goes up 6% and quantity demanded goes down 3%, the product has an:

• Elastic demand

• Inelastic demand

• Elastic supply

• Inelastic supply

 If price goes up 20% and supply goes up 20%, supply is:

• Elastic

• Inelastic

• Unitary

• None of the above

Demand for a product with no substitutes would be considered:

• Elastic in the short-term

• Inelastic in the short-term

• Unitary

• None of the above

Which of the following has an inelastic demand?

• Gasoline

• Candy

• Medicine

• A and C

• All of the above

Which of the following products is most likely to have a demand coefficient of 0.60?

• Advil

• Baby formula

• Peanut Butter O'Henry Chocolate Bar

• Dawn Dish Soap

Minimum wage is an example of

• Elastic demand

• Inelastic demand

• Price floor

• Price Ceiling

• Subsidy

Minimum wage set above the equilibrium:

• Is the same as living wage

• Is a price ceiling

• Can result in a shortage of labour

• Can result in a surplus of labour

If the government introduces a subsidy on farm products:

• 1. The equilibrium price will increase, quantity supplied will increase

• The equilibrium price will increase, quantity supplied will decrease

• The equilibrium price will decrease, quantity demanded will decrease

• The equilibrium price will decrease, quantity demanded will increase