Demand is said to be inelastic if a(n) ______.
a. 9 percent price increase causes a 11 percent increase in quantity demanded
b. 5 percent price increase causes 6 percent reduction in quantity demanded
c. 8 percent price increase causes an 8 percent reduction in quantity demanded
d. 10 percent price increase causes a 2 percent reduction in quantity demanded
d. 10 percent price increase causes a 2 percent reduction in quantity demanded
You might also like to view...
When marginal analysis is used to determine the optimal quantity of accident avoidance, all of the following are true except which one?
A) The sum of the expected cost of an accident and the cost of avoiding accidents is minimized. B) The expected marginal benefit of accident avoidance exceeds the marginal cost. C) The total cost of the accident is minimized. D) The expected marginal benefit of accident avoidance equals the marginal cost.
"The United States has more oil in Alaska than there is oil in Kuwait. Therefore, the United States should stop importing oil." Evaluate this statement using economic analysis
Explain the difference between American and European options.
What will be an ideal response?
The graph above shows the PPC for a country that can produce oil, which is labor intensive, or televisions, which are capital intensive. The country is currently producing at point A and not trading with the rest of the world. With trade, the world price can be represented by slope of the straight line through Point A. Which of the following is a true statement?
A) When this country produces the optimal amount with trade, workers in this country will be better off. B) When this country produces the optimal amount with trade, capital in this country will be better off. C) When this country produces the optimal amount with trade, both factors of production will be better off. D) When this country produces the optimal amount with trade, the income of factors of production will not change.