If the price elasticity of demand for gasoline is 0.8 and the price elasticity of demand for plane tickets is 2.2 then the demand for gasoline is ________ and the demand for plane tickets is ________
A) elastic; inelastic
B) inelastic; elastic
C) elastic; elastic
D) inelastic; inelastic
B
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Assume a firm is able to use an optimal two-part tariff
a. Is the outcome economically efficient? Why or why not? b. What happens to consumer surplus? c. Does this represent perfect price discrimination? Why or why not? What will be an ideal response?
The aggregate demand curve:
A. shows the price level on the horizontal axis and output on the vertical axis. B. shows the relationship between the overall price level and the level of total demand. C. shows the relationship between the price of goods and services and the level of total demand. D. is upward-sloping, which is counter to the individual demand curve.
The option-value principle can be roughly stated as "more choices can't make a person worse off.". Are there any exceptions to this rule? Choose all that apply. a. No
b. Yes, in strategic situations. c. Yes, in situations involving self-control. d. Yes, for certain complicated financial derivatives.
Capital is the
a. flow of new equipment that a firm acquires over the course of a year. b. amount of increase in a firm's equipment over a year. c. amount of money that a firm has on hand at a given time. d. stock of plant, equipment, and other productive resources held by a firm.