When the price of candy bars decreased from $0.55 to $0.45, the quantity demanded changed from 19,000 per day to 21,000 per day. In this price range, the price elasticity of demand (based on the midpoint formula) is
A. -0.5.
B. -0.2.
C. -1.
D. -2.
Answer: A
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Of the four major market structures, oligopoly is the worst at achieving economic efficiency
a. True b. False
Mortgage loans made to borrowers with a more limited ability to repay are known as
a. subprime mortgages. b. credit default swaps. c. leveraged securities. d. mortgage backed securities.
The results of the ultimatum game illustrate that
a. people's behavior is often driven by an innate sense of fairness. b. homo economicus is a good description of people's behavior. c. self-interest brings out the most efficient economic outcome. d. people will always prefer a small gain to no gain.
When comparisons are made between the earnings of whites and minorities with the same age, quantity of schooling, marital status, sector of employment, union and industry status, regional location, and annual hours worked, recent studies indicate that
a. the corrected earnings of minority men are about two-thirds the earnings of white men. b. the corrected earnings of Mexican-Americans, Asian-Americans, and American Indians were between 7 and 9 percent less than the earnings of similar white men. c. earnings differentials between whites and minorities are due almost exclusively to employment discrimination. d. most minority men now have higher earnings than white men.