Quiz_elasticityquiz.pdf - Elasticity Quiz Score 1.Suppose a...

This preview shows page 1 - 2 out of 3 pages.

Elasticity Quiz Score: 1. Suppose a firm is selling a product at a price on the inelastic portion of the demand line. This firm could increase revenue by A lowering the price, selling more units. B lowering the price, selling less units. C increasing the price, selling more units. D increasing the price, selling less units. 2. In terms of price elasticity of demand, which of the following goods do you think is the least elastic (most inelastic)? A New house B Electricity to power your home C A specific brand of breakfast cereal D New vehicle 3. Suppose that the price of candy bars increases by 100%. As a result of this, you decide to purchase 50% fewer candy bars. How would you describe your demand for candy bars? A Demand is elastic. B Demand is unit elastic. C Demand is inelastic. D Demand is perfectly inelastic. 4. Suppose a hotel manager raises the price of bottled water from $3.00 to $5.00 and then finds that consumption drops from 1,000 to 900 bottles per week. Is the price elasticity of demand for bottled water elastic or inelastic? Show your calculations.
Image of page 1

Subscribe to view the full document.

Image of page 2

{[ snackBarMessage ]}

Get FREE access by uploading your study materials

Upload your study materials now and get free access to over 25 million documents.

Upload now for FREE access Or pay now for instant access
Christopher Reinemann
"Before using Course Hero my grade was at 78%. By the end of the semester my grade was at 90%. I could not have done it without all the class material I found."
— Christopher R., University of Rhode Island '15, Course Hero Intern

Ask a question for free

What students are saying

  • Left Quote Icon

    As a current student on this bumpy collegiate pathway, I stumbled upon Course Hero, where I can find study resources for nearly all my courses, get online help from tutors 24/7, and even share my old projects, papers, and lecture notes with other students.

    Student Picture

    Kiran Temple University Fox School of Business ‘17, Course Hero Intern

  • Left Quote Icon

    I cannot even describe how much Course Hero helped me this summer. It’s truly become something I can always rely on and help me. In the end, I was not only able to survive summer classes, but I was able to thrive thanks to Course Hero.

    Student Picture

    Dana University of Pennsylvania ‘17, Course Hero Intern

  • Left Quote Icon

    The ability to access any university’s resources through Course Hero proved invaluable in my case. I was behind on Tulane coursework and actually used UCLA’s materials to help me move forward and get everything together on time.

    Student Picture

    Jill Tulane University ‘16, Course Hero Intern