Podcast
Questions and Answers
What does an inelastic supply indicate?
What does an inelastic supply indicate?
- The supply is highly responsive to price changes
- The supply is not affected by price changes
- The capacity to increase production is high
- The capacity to increase production is limited (correct)
What affects the price elasticity of supply?
What affects the price elasticity of supply?
- Only time to respond
- Only production capacity
- Only consumer behavior
- Production capacity, time to respond, and mobility of resources (correct)
What is measured by cross elasticity of demand?
What is measured by cross elasticity of demand?
- The effect of income on demand
- How the quantity supplied responds to a price change
- How the quantity demanded responds to a price change of another good (correct)
- The effect of price on supply
What is an example of complementary goods?
What is an example of complementary goods?
What does a positive cross elasticity of demand indicate?
What does a positive cross elasticity of demand indicate?
What is measured by income elasticity of demand?
What is measured by income elasticity of demand?
What is an example of a normal good?
What is an example of a normal good?
What is an example of an inferior good?
What is an example of an inferior good?
Why is it important to understand elasticity in business and policymaking?
Why is it important to understand elasticity in business and policymaking?
What can understanding elasticity of demand help businesses with?
What can understanding elasticity of demand help businesses with?
What is price elasticity a measure of?
What is price elasticity a measure of?
How is price elasticity of demand calculated?
How is price elasticity of demand calculated?
What is elastic demand?
What is elastic demand?
Which of the following factors makes demand more elastic?
Which of the following factors makes demand more elastic?
What is the characteristic of necessities in terms of price elasticity of demand?
What is the characteristic of necessities in terms of price elasticity of demand?
What is price elasticity of supply a measure of?
What is price elasticity of supply a measure of?
What is the characteristic of elastic supply?
What is the characteristic of elastic supply?
What happens to the demand for a product over a long period of time?
What happens to the demand for a product over a long period of time?
What is unit elastic demand?
What is unit elastic demand?
Why do products that consume a larger portion of the consumer's income tend to have more elastic demand?
Why do products that consume a larger portion of the consumer's income tend to have more elastic demand?
When the elasticity of supply is less than 1, what can be inferred about the capacity to increase production?
When the elasticity of supply is less than 1, what can be inferred about the capacity to increase production?
Which of the following factors makes supply more inelastic?
Which of the following factors makes supply more inelastic?
What is the relation between the quantity demanded of cars and the price of fuel?
What is the relation between the quantity demanded of cars and the price of fuel?
What can be inferred about a good with a negative income elasticity of demand?
What can be inferred about a good with a negative income elasticity of demand?
What is the primary goal of understanding elasticity in business and policymaking?
What is the primary goal of understanding elasticity in business and policymaking?
Which of the following types of goods is likely to have a positive income elasticity of demand?
Which of the following types of goods is likely to have a positive income elasticity of demand?
What happens to the supply of a good when its production resources can be easily allocated to different uses?
What happens to the supply of a good when its production resources can be easily allocated to different uses?
What can businesses do with the knowledge of elasticity of supply?
What can businesses do with the knowledge of elasticity of supply?
What can be inferred about two goods with a positive cross elasticity of demand?
What can be inferred about two goods with a positive cross elasticity of demand?
Over a longer period, what happens to the elasticity of supply?
Over a longer period, what happens to the elasticity of supply?
What is the primary difference between price elasticity of demand and price elasticity of supply?
What is the primary difference between price elasticity of demand and price elasticity of supply?
What happens to the elasticity of demand for a product when there are more substitutes available?
What happens to the elasticity of demand for a product when there are more substitutes available?
Which of the following products is likely to have inelastic demand?
Which of the following products is likely to have inelastic demand?
What is the characteristic of elastic supply?
What is the characteristic of elastic supply?
Why do businesses need to understand price elasticity of demand?
Why do businesses need to understand price elasticity of demand?
What is the effect of a longer time period on the elasticity of demand?
What is the effect of a longer time period on the elasticity of demand?
What is the primary difference between elasticity of demand and elasticity of supply?
What is the primary difference between elasticity of demand and elasticity of supply?
What is the likely outcome when the price of a product with elastic demand increases?
What is the likely outcome when the price of a product with elastic demand increases?
What is the characteristic of a product with unit elastic demand?
What is the characteristic of a product with unit elastic demand?
What is the likely outcome when the price of a product with elastic supply decreases?
What is the likely outcome when the price of a product with elastic supply decreases?
If a company has a highly elastic supply of labor, which of the following is likely to occur?
If a company has a highly elastic supply of labor, which of the following is likely to occur?
What is the likely outcome when the price of a good with a high cross elasticity of demand with another good increases?
What is the likely outcome when the price of a good with a high cross elasticity of demand with another good increases?
Which of the following is an example of a good with a high income elasticity of demand?
Which of the following is an example of a good with a high income elasticity of demand?
What is the likely outcome when a company operates in a market with a low cross elasticity of demand?
What is the likely outcome when a company operates in a market with a low cross elasticity of demand?
If a company has an inelastic supply of a good, what is the likely outcome when the market price increases?
If a company has an inelastic supply of a good, what is the likely outcome when the market price increases?
What is the likely outcome when the government imposes a tax on a good with an elastic demand?
What is the likely outcome when the government imposes a tax on a good with an elastic demand?
If two goods have a negative cross elasticity of demand, what can be inferred about the goods?
If two goods have a negative cross elasticity of demand, what can be inferred about the goods?
What is the likely outcome when a company has a highly elastic demand for its good?
What is the likely outcome when a company has a highly elastic demand for its good?
If a company operates in a market with a high income elasticity of demand, what is the likely outcome when consumer income increases?
If a company operates in a market with a high income elasticity of demand, what is the likely outcome when consumer income increases?
What is the likely outcome when a company has a highly inelastic supply of a good?
What is the likely outcome when a company has a highly inelastic supply of a good?
If the price of a product with a price elasticity of demand of 2 increases by 10%, what will be the approximate percentage change in the quantity demanded?
If the price of a product with a price elasticity of demand of 2 increases by 10%, what will be the approximate percentage change in the quantity demanded?
A product has a price elasticity of supply of 1.5. If the price of the product increases by 20%, what will be the approximate percentage change in the quantity supplied?
A product has a price elasticity of supply of 1.5. If the price of the product increases by 20%, what will be the approximate percentage change in the quantity supplied?
Which of the following is a characteristic of a product with an elastic demand?
Which of the following is a characteristic of a product with an elastic demand?
If the price of a product with a price elasticity of demand of 0.5 decreases by 15%, what will be the approximate percentage change in the quantity demanded?
If the price of a product with a price elasticity of demand of 0.5 decreases by 15%, what will be the approximate percentage change in the quantity demanded?
What happens to the elasticity of demand for a product when the time period is increased?
What happens to the elasticity of demand for a product when the time period is increased?
Which of the following products is likely to have a more elastic demand, a luxury car or a needed medicine?
Which of the following products is likely to have a more elastic demand, a luxury car or a needed medicine?
What happens to the quantity demanded of a product when the price of a close substitute decreases?
What happens to the quantity demanded of a product when the price of a close substitute decreases?
What is the effect of a decrease in the price of a product with an elastic supply?
What is the effect of a decrease in the price of a product with an elastic supply?
If the price elasticity of demand for a product is 3, what will be the effect of a 10% increase in price on the quantity demanded?
If the price elasticity of demand for a product is 3, what will be the effect of a 10% increase in price on the quantity demanded?
What is the effect of an increase in the proportion of income spent on a product on its elasticity of demand?
What is the effect of an increase in the proportion of income spent on a product on its elasticity of demand?
Flashcards are hidden until you start studying
