Free Printable PRICE ELASTICITY OF DEMAND

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PRICE ELASTICITY OF DEMAND

Total questions: 15

Worksheet time: 1hrs 15mins

Name

Class

Date

Demand is almost always more elastic at higher prices and less elastic at lower prices.

True

False

Demand is unit elastic if it is less than 1.0

True

False

The formula for calculating elasticity of demand is:

The % change in price over the % change in quantity demanded

The % change in quantity demanded over the % change in price

The change in price over the change in quantity demaned

The change in quantity demanded over the change in price

Which of the following is not a determinant of demand elasticity?

availability of substitutes

share of consumer's budget spend on good

duration of adjustment period

government spending

If the price on a product goes up the quantity demanded will go down. This follows the economic theory of:

Law of Demand

elasticity

Ceteris Paribus

Both A and C

What does it mean?

Ed = 0

Perfectly inelastic demand

Inelastic demand

Unitarily elastic demand

Elastic demand

Perfectly elastic demand

What does it mean?

Ed = 1

Perfectly inelastic demand

Inelastic demand

Unitarily elastic demand

Elastic demand

Perfectly elastic demand

What does it mean?

Ed = ∞

Perfectly inelastic demand

Inelastic demand

Unitarily elastic demand

Elastic demand

Perfectly elastic demand

What does it mean?

Ed > 1

Perfectly inelastic demand

Inelastic demand

Unitarily elastic demand

Elastic demand

Perfectly elastic demand

10.

What does it mean?

Ed < 1

Perfectly inelastic demand

Inelastic demand

Unitarily elastic demand

Elastic demand

Perfectly elastic demand

11.

What does it mean?

% change in Qd = % change in P

Perfectly inelastic demand

Inelastic demand

Unitarily elastic demand

Elastic demand

Perfectly elastic demand

12.

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.

13.

Suppose there is a 6 percent increase in the price of good X and a resulting 6 percent decrease in the quantity of X demanded. Price elasticity of demand for X is

14.

Which of the following has more elastic demand?

15.

Which of the following has more inelastic demand?

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PRICE ELASTICITY OF DEMAND

Total questions: 15

Worksheet time: 1hrs 15mins

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