Understanding Economics Terms

What is total revenue?

• Total revenue = Price per unit + Quantity sold

• Total revenue = Price per unit x Quantity sold

• Total revenue = Cost per unit x Quantity sold

• Total revenue = Price per unit - Quantity sold

How is price elasticity defined?
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What are economies of scale?

• Economies of scale refer to the increase in product prices as production rises.

• Economies of scale are the financial losses incurred when production is inefficient.

• Economies of scale are the cost advantages that arise when production becomes efficient, leading to a decrease in per-unit costs as output increases.

• Economies of scale describe the benefits of reducing workforce size to cut costs.

What does elasticity of supply measure?

• The effect of consumer preferences on production.

• The relationship between supply and demand.

• The total quantity of goods produced in a year.

• The responsiveness of quantity supplied to price changes.

Which Taiwanese supply is elastic?

• Bubble Milk tea

• Construction material supply in Taiwan
• Agricultural supply in Taiwan
• Textile supply in Taiwan

What characterizes elastic supply?

• A significant change in quantity supplied in response to price changes.

• An increase in quantity supplied only when demand decreases.

• A minor change in quantity supplied with no relation to price changes.

• No change in quantity supplied regardless of price changes.

What is inelastic supply?

• Inelastic supply is when the quantity supplied increases with price changes.

• Inelastic supply refers to a situation where supply can be easily adjusted to meet demand.

• Inelastic supply is when the quantity supplied is unresponsive to price changes.

• Inelastic supply means that the quantity supplied is highly responsive to price fluctuations.

What does the law of supply state?

• The law of supply states that higher prices lead to lower quantities supplied.

• The law of supply states that higher prices lead to higher quantities supplied.

• The law of supply states that supply is independent of price changes.

• The law of supply states that lower prices lead to lower quantities supplied.

How does total revenue change with price elasticity?

• Total revenue decreases with a price increase if demand is elastic.

• Total revenue remains unchanged with any price change.

• Total revenue increases with a price decrease if demand is elastic, decreases if demand is inelastic, and remains unchanged if demand is unitary elastic.

• Total revenue increases with a price increase if demand is inelastic.

What factors influence the elasticity of demand?

• Factors influencing the elasticity of demand include availability of substitutes, income proportion, necessity vs. luxury, time period, and consumer preferences.

• Weather conditions

• Brand loyalty

• Advertising strategies