If the total revenue received by sellers of DVDs increases by 20 percent when price increases by 10 percent, then demand for DVDs is
A) perfectly elastic.
B) unitary elastic.
C) inelastic.
D) elastic.
C
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What happens if price falls below the market clearing price?
A) Demand shifts out. B) Supply shifts in. C) Quantity demanded decreases, quantity supplied increases, and price falls. D) Quantity demanded increases, quantity supplied decreases, and price rises.
In the early 1950s the two new factors that stimulated the United States' economy were ___________ and ____________.
Fill in the blank(s) with the appropriate word(s).
Your classmates from the University of Chicago are planning to go to Miami for spring break, and you are undecided about whether you should go with them. The round-trip airfare is $600, but you have a frequent-flyer coupon worth $500 that you could use to pay part of the airfare. All other costs for the vacation are exactly $900. The most you would be willing to pay for the trip is $1,400. Your only alternative use for your frequent-flyer coupon is for your trip to Atlanta two weeks after the break to attend your sister's graduation, which your parents are forcing you to attend. The Chicago-Atlanta round-trip airfare is $450. If the Chicago-Atlanta round-trip air fare were $350, should you use the coupon to go to Miami?
A. No, your economic surplus would be -$100. B. Yes, your economic surplus would be $50. C. Yes, your economic surplus would be $400. D. No, your economic surplus would be -$50.
The cross-price elasticity of demand between goods X and Y
A. measures the responsiveness of the quantity of X demanded to changes in the price of Y. B. is the percentage change in the price of Y divided by the percentage change in the quantity of X demanded. C. is greater than zero if X and Y are substitutes. D. both a and c E. all of the above