Practice Questions for Chapter 5

Practice Questions for Chapter 5 - Practice Questions for...

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Practice Questions for Chapter 5 Name: __________________________ Date: _____________ 1. Price elasticity of demand measures the responsiveness of the change in: A) quantity demanded to a change in price. B) price to a change in quantity demanded. C) slope of the demand curve to a change in price. D) slope of the demand curve to a change in quantity demanded. 2. When price goes down, the quantity demanded goes up. Price elasticity measures: A) how much the price goes down. B) how much the quantity goes up. C) how responsive the price change is in relation to the quantity change. D) how responsive the quantity change is in relation to the price change. 3. If the price of a good is increased by 15 percent and the quantity demanded changes by 20 percent, then the price elasticity of demand is equal to: A) 0.75. B) approximately 0.33. C) approximately 1.33. D) 1. 4. If the price of chocolate-covered peanuts decreases from $1.10 to $0.90 and the quantity demanded increases from 190 bags to 210 bags, this indicates that, if other things are unchanged, the price elasticity of demand using the midpoint method is: A) 0. B) 0.5. C) 1. D) 2. Page 1
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5. If the price of chocolate-covered peanuts decreases from $1.10 to $0.90 and the quantity demanded does not change, this indicates that, if other things are unchanged, the price elasticity of demand using the midpoint method is: A) 0. B) 0.5. C) 1. D) 2. 6. If the price of chocolate-covered peanuts decreases from $1.05 to $0.95 and the quantity demanded increases from 180 bags to 220 bags, this indicates that, if other things are unchanged, the price elasticity of demand using the midpoint method is:
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This note was uploaded on 03/16/2010 for the course ECON 2100 taught by Professor Klimenko during the Spring '08 term at Georgia Institute of Technology.

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Practice Questions for Chapter 5 - Practice Questions for...

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