Micro-Economics 6-10 Review

Micro-Economics 6-10 Review - Chapters 6 - 10 Review...

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Chapters 6 - 10 Review • 1.Suppose at a price of $10 the quantity demanded is 100. When price falls to $8, the quantity demanded increases to 130. The price elasticity of demand between the prices of $10 and $8 using the midpoint method is approximately: •A )1 .17 . •B )1 .50 . • C)0.85. • D)1.00. Chapters 6 - 10 Review • 2. If an increase in the price of a good leads to an increase in total revenue, then: • A) the supply curve must be price inelastic. • B) the demand curve must be price inelastic. • C) the supply curve is price elastic. • (D) none of the above are correct. Chapters 6 - 10 Review • 3.Suppose the price elasticity of demand for cheeseburgers equals 0.37. This means the overall demand for cheeseburgers is: • A) price elastic. • B) price inelastic. • C) price unit-elastic. • D) perfectly price inelastic. Chapters 6 - 10 Review • 4.The price elasticity of demand: • A) measures the responsiveness of quantity demanded to a change in price. • B) measures the responsiveness of price to a
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Chapters 6 - 10 Review • 5.Suppose the price of gasoline increases 10% and quantity demanded in Orlando drops 5% per day. The price elasticity of demand for gasoline in Orlando is: • A) price elastic. • B) price inelastic. • C) price unit-elastic. • D) perfectly price inelastic. Chapters 6 - 10 Review • 6. After you graduate from college, you open a business selling computers. There are many other businesses in your city that sell similar computers. Based on this information, the price elasticity of demand for the computers that your business sells will be: • A) one. •B ) z e r o . • C) highly elastic. • D) highly inelastic. Chapters 6 - 10 Review • 7. 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. Chapters 6 - 10 Review • 8. When a public transit system (such as a subway or bus line) raises its fares, and
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Chapter 7 Question 10. An excise tax collected from the producers of a good: • A) shifts the supply curve upward. • B) creates a loss of revenue for the government. • C) has a similar effect as a tax subsidy. • D) shifts the supply curve downward.
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Micro-Economics 6-10 Review - Chapters 6 - 10 Review...

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