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price elasticity of demand

6. The sensitivity of the change in quantity demanded to a change in price is called

A. income elasticity
B. cross-elasticity
C. price elasticity of demand
D. coefficient of elasticity

7. Two goods are ____________ if the quantity consumed of one increases when the price of the the other decreases.

A. normal
B. superior
C. complementary
D substitute

8. When a one percent change in price results in a one percent change in quantity demanded in the opposite direction, demand is

A. relatively inelastic
B. unitary elastic
C. perfectly elastic
D. perfectly inelastic

9. The owner of a produce store found that when the price of a head of lettuce was raised from 50 cents to $1, the quantity sold per hour fell from 18 to 8. The arc elasticity of demand for lettuce is
A. -0.56
B. -1.15
C. -0.8
D. -1.57

10. When total revenue increases from $18,000 to $26,000 when quantity increases from eight to ten, marginal revenue is equal to

A. $3,000
B. $4,000
C. $8,000
D. $2,600

Solution Preview

6. The sensitivity of the change in quantity demanded to a change in price is called
A. income elasticity
B. cross-elasticity
C. price elasticity of demand
D. coefficient of elasticity

by definition, this is price elasticity of demand

7. Two goods are ____________ if the quantity consumed of one increases when the price of the the other decreases.
A. normal
B. superior
C. complementary ...

Solution Summary

Define unitary elastic.

$2.19