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SOLUTIONS TO ECON QUIZ

# 18 d its the graph in the notes 19

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Unformatted text preview: rgers, decreases. 17. B, because if there is less time to make adjustments for example in the instance of a price increase in the metro, you are more likely to stick with the metro for that short time than switch over. In the long ­run, you’ll definitely switch over to other less expensive forms of transportation once you’ve found them. So less time mean inelastic. 18. D, it’s the graph in the notes. 19. C, use the formula EM = %∆QD/%∆P. 20. A, because the elasticity is less than 1. 21. D, sry about that! This question was weird. I didn’t catch it! But if you would have picked normal good had it been an answer, then good for you! 22. D, use the formula ED = %∆QD/%∆P. E = 20/( ­10) =  ­2. The absolute value of E > 1, so demand is relatively elastic. 23. A, if there are many close substitutes this means that when you increase price, consumers would substitute for other goods, making demand more elastic. 24. B, use the formula ES = %∆QS/%∆P. 25. C,...
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