If a 5 percent increase in the price of good a leads

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5) If a 5 percent increase in the price of good A leads to a 4 percent decrease in the quantity demanded for good B, then ____. A) the goods are substitutes B) only one good is a normal good C) the goods are complements D) both goods are normal goods 1
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6) As Mary’s income increases by 20 percent, her demand for tickets to National Hockey League games increases by 10 percent. Mary’s demand for tickets is income ____; for Mary, hockey tickets are ____ good. 2
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7) The figure illustrates the demand for magazines. Newsagents will maximize their total revenue when they ____. 8) In the market for music CDs, the producer surplus will definitely decrease if ____. 9) Suppose that a sales tax is imposed on a good, but the price consumers pay does not change. Such a situation will occur if the ____ the good is ____. A) demand for; perfectly elastic B) demand for; unit elastic C) supply of; perfectly elastic D) demand for; perfectly inelastic 10) All else equal, the more price elastic the supply, the _____ is the amount of the tax on the good that the ____ pays. 3
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