Which of the following describes a situation in which demand must be elastic?
a. The price of pens rises by 10 cents, and quantity of pens demanded falls by 50.
b. The price of pens rises by 10 cents, and total revenue rises.
c. A 20 percent increase in the price of pens leads to a 20 percent decrease in the quantity of pens demanded.
d. Total revenue does not change when the price of pens rises.
e. Total revenue decreases when the price of pencils rises.
E
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Use the following table with data for a private closed economy (an economy with only a private sector and no international trade) to answer the next question. All figures are in billions of dollars.Domestic Output or Income (RGDP = DI)Consumption$540$540560555580570600585620600640615660630If gross investment is $25 billion, the equilibrium level of real GDP will be
A. $620 billion. B. $600 billion. C. $640 billion. D. $660 billion.
Which of the following episodes would most likely contain an externality?
A) You cannot afford to buy groceries. B) You decide to grow your own vegetables in your backyard where no one else can see them. C) You decide to grow flowers in your front yard where everyone else can see them. D) You eat all the vegetables you grow yourself.
In 2014, the price of peanuts was rising, which lead peanut butter sellers and peanut butter buyers to expect the price of peanut butter would rise in the future
Consequently, in the current market for peanut butter there was ________ which resulted in a ________ in the price of peanut butter and ________ in the quantity of peanut butter. A) a decrease in supply of peanut butter and an increase in demand for peanut butter; rise; an increase, decrease or possibly no change B) a decrease in supply of peanut butter and a decrease in demand for peanut butter; rise, fall, or possibly no change; a decrease C) an increase in supply of peanut butter and a decrease in demand for peanut butter; fall; an increase, decrease or possibly no change D) a decrease in supply of peanut butter and an increase in demand for peanut butter; fall; an increase, decrease or possibly no change
When a firm charges more per ounce for a small bottle of ketchup than for a larger one, it is engaging in:
A. price discrimination based on observable customer characteristics. B. perfect price discrimination. C. quantity-dependent pricing. D. two-part tariff pricing.