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Unformatted text preview: QUIZ 7 ECON 210 Name: __________________________ 1. As price of Coca-cola increased by 12% the quantity demanded fell by 36%. This implies that the price elasticity of demand for Coca-cola is : a. 1/3 b. 3 c. 24 d. 48 2. Suppose that ABC Co. faces an inelastic demand for its product, bath soaps. Which action from the list below, would you recommend that the CEO of ABC do to raise revenues? a. Increase prices b. Decrease prices c. Reduce costs d. Improve productivity of workers 3. Which of the following statement(s) is false ? a. When demand is inelastic there is a relatively large response from consumers to a decrease in price b. Total revenue is unaffected if the percentage change in quantity matches the percentage change in price c. If demand is elastic , increasing prices will decrease total revenue d. A and C 4. In which of the following cases will demand for Good X likely to be more elastic?...
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- Fall '08
- Price Elasticity