Answers to Chapter 5 Quiz - 22 a Total revenue from...

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Chapter 5 Quiz Answer Section MULTIPLE CHOICE 1. B 2. B 3. D 4. C 5. C 6. B 7. A 8. A 9. D 10. A 11. B 12. B 13. A 14. D 15. A 16. C 17. D 18. B 19. B 20. C SHORT ANSWER 21. a. Diamonds are luxuries, and water is a necessity. Therefore, diamonds have the more elastic demand. b. Insulin has no close substitutes, but decongestant spray does. Therefore, nasal decongestant spray has the more elastic demand. c. Breakfast cereal has more substitutes than does food in general. Therefore, breakfast cereal has the more elastic demand. d. The longer the time period, the more elastic demand is. Therefore, gasoline over the course of a year has the more elastic demand. e. There are more substitutes for IBM personal computers than there are for personal computers. Therefore, IBM personal computers have the more elastic demand.

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Unformatted text preview: 22. a. Total revenue from children's tickets is \$100 and from adult tickets is \$250. Total revenue from all sales would be \$350. b. The demand for children's tickets is more elastic. c. The adult ticket market has the more inelastic demand. d. The elasticity of demand between \$5 and \$2 is 0.26, which is inelastic e. The elasticity of demand between \$5 and \$2 is 1.0, which is unit elastic. f. Total revenue in the adult market would be \$320. Total revenue in the children’s market would be \$120, so total revenue for both groups would be \$440. \$440 - \$350 is an increase in total revenue of \$90. 23. a. A to B b. B to C c. B d. B to C e. A to B f. B g. B h. A to B i. B j. B to C...
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Answers to Chapter 5 Quiz - 22 a Total revenue from...

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