Class_practice_set_2_September_27,_2010_revised - Copy

# Class_practice_set_2_September_27,_2010_revised - Copy -...

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W1105- Principles of Economics, Fall,  2010 Professor Padma Desai 417 IAB Practice Set 2 Professor Desai will discuss the questions in the class on Monday, September 27 at the start of the lectue. Please carry a copy with you to the lecture WITHOUT FAIL 1) At a price of \$20, a store can sell 24 picture frames a day. At a price of \$18 the store can sell 33 picture frames a day. Using the midpoint formula, the price elasticity of demand is : a) 9.09 b) 0.33 c) 3.75 d) -3.0 2) A _______ line is a perfectly inelastic demand curve a) negatively sloped b) positively sloped c) horizontal d) vertical 3) Cross-price elasticity of demand measures the response in the a) quantity of one good demanded when the quantity demanded of another good changes b) quantity of one good demanded to a change in the price of another good c) income of consumers to the change in the price of goods d) price of a good to a change in the quantity of another good demanded 4) If the owner of an ice cream store on Amsterdam Avenue charges \$1.20 for an ice

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## This note was uploaded on 09/29/2010 for the course ECON W1155 taught by Professor Gulati during the Fall '08 term at Columbia.

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Class_practice_set_2_September_27,_2010_revised - Copy -...

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