The price elasticity of demand measures
A) the consumers' sensitivity to a price change.
B) the producers' sensitivity to a price change.
C) how much the market supply changes in response to a change in demand.
D) how much the demand changes in response to a change in income.
Answer: A
You might also like to view...
If American college students decide that drinking Mexican-brewed beer helps one get noticed, net exports will tend to fall, causing aggregate demand to ________ and the ________ curve to shift to the left, everything else held constant
A) fall; LM B) fall; IS C) rise; LM D) rise; IS
One concept that behavioral economists use to account for procrastination is:
A. the time inconsistency of our decision-making. B. the fungibility of money. C. thinking inconsistently about prices. D. framing bias.
Through collective bargaining,
a. representatives of an employer negotiate with the rank and file of the union membership b. union and nonunion members combine forces in negotiation c. craft and industrial unions combine forces in negotiation d. contracts are worked out between representatives of the union and employer representatives e. union workers must accept contracts negotiated by their representatives
If a consumer is spending all of his/her income in a manner where MUa / Pa = MUb / Pb, then the consumer:
a. should increase the consumption of A and decrease the consumption of B. b. is maximizing his/her utility. c. should increase the consumption of B and decrease the consumption of A. d. should increase the consumption of both A and B. e. should decrease the purchases of both A and B.