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Rutgers University. Spring 2009

Rutgers University. Spring 2009 - Tests for Chapters 5-7...

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Tests for Chapters 5-7. Rutgers University. Spring 2009. Microeconomics. 220:102:08 Instructor: Swanzer. No Cell Phones allowed Multiple Choice Identify the letter of the choice that best completes the statement or answers the question. ____ 1. The price elasticity of demand measures a. buyers’ responsiveness to a change in the price of a good. b. the extent to which demand increases as additional buyers enter the market. c. how much more of a good consumers will demand when incomes rise. d. the movement along a supply curve when there is a change in demand. ____ 2. The demand for Werthers candy is likely ____ 3. There are very few, if any, good substitutes for motor oil. Therefore, ____ 4. The price elasticity of demand for bread Figure 5-2 ____ 5. Refer to Figure 5-2 . If the price decreased from $18 to $6, a. total revenue would increase by $1,200 and demand is elastic between points A and C. b. total revenue would increase by $800 and demand is elastic between points A and C. c. total revenue would decrease by $1,200 and demand is inelastic between points A and C. d. total revenue would decrease by $800 and demand is inelastic between points A and C.
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____ 6. Demand is said to be unit elastic if ____
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