If the elasticity of demand for cigarettes is 0.4, then an increase in the price of a pack of cigarettes from $1.00 to $1.30 would reduce quantities demanded by about
a. 27 percent.
b. 40 percent.
c. 12 percent.
d. 95 percent.
C
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What effect does foreign exchange market intervention by the U.S. Federal Reserve to increase the value of the U.S. dollar have on the U.S. monetary base?
a. The U.S. monetary base decreases. b. The U.S. monetary base increases. c. It does not have an effect on the U.S. monetary base at all. d. The effect on the U.S. monetary base is ambiguous and depends on where counterparties deposit the funds.
The fastest growing economy between 1870 and 1979 was
A. the United Kingdom. B. the United States. C. Japan. D. Brazil.
We import more goods and services from ___________ than from any other country.
Fill in the blank(s) with the appropriate word(s).
Suppose that the elasticity of demand for a product is 0.5 and price decreases by 20%. By what percentage will quantity demanded increase?
A. 0.5% B. 5% C. 10% D. 40%