18) If the price elasticity of demand is 0.6, then a 10 percent increase in the price of the good will lead to a in the quantity demanded. A) 0.6 percent decrease C) 6 percent decrease B) 0.6 percent increase D) 6 percent increase 19) For product XYZ, the price elasticity of demand has an absolute value of 3.5. This means that quantity demanded will increase by A) 3.5 percent for each 1 percent decrease in price, ceteris paribus B) 3.5 units for each $1 decrease in price, ceteris paribus. C) 1 percent for each 3.5 percent decrease in price, ceteris paribus. D) 1 unit for each $3.50 decrease in price, ceteris paribus. 20) Suppose a university raises its tuition by 6 percent and as a result the enrollment of students decreases by 3 percent. The absolute value of the price elasticity of demand is A) 8.0. D) 0.5. B) 2.0. C) 6.0. 21) If demand is price-elastic, then A) The elasticity number E is less than 1. C) The elasticity number E is greater than 1. B) The elasticity number E is equal to 1 D) The elasticity number E is 0. 22) A demand curve that is perfectly inelastic is A) Downward-sloping. C) Upward-sloping. B) Horizontal. D) Vertical. 23) If the price elasticity of demand for cigarettes is 0.4, A) A 10 percent increase in price will cause quantity demanded to fall by 40 percent. B) The demand is very inelastic. C)A 5 percent decrease in price will cause quantity demanded to rise by 10 percent. D) The demand is very elastic. 24) Which of the following products will have more inelastic demand? B) Medicines. D) Fresh flowers. C) New cars. A) Fast food. 25) Which of the following products will have elastic demand? A) Alcohol. C) Gasoline. B) European travel. D) Cigarettes. 26) Which of the following is not a determinant of the price elasticity of demand? A) The number of substitute goods available. B) The amount of income the consumer has. C) The time frame-whether it is in the short run or long run. D) The share ofa consumers budget. 9L89 2 008
18) If the price elasticity of demand is 0.6, then a 10 percent incre
18) If the price elasticity of demand is 0.6, then a 10 percent increase in the price of the good will lead to a in the quantity demanded. A) 0.6 percent decrease C) 6 percent decrease B) 0.6 percent increase D) 6 percent increase 19) For product XYZ, the price elasticity of demand has an absolute value of 3.5. This means that quantity demanded will increase by A) 3.5 percent for each 1 percent decrease in price, ceteris paribus B) 3.5 units for each $1 decrease in price, ceteris paribus. C) 1 percent for each 3.5 percent decrease in price, ceteris paribus. D) 1 unit for each $3.50 decrease in price, ceteris paribus. 20) Suppose a university raises its tuition by 6 percent and as a result the enrollment of students decreases by 3 percent. The absolute value of the price elasticity of demand is A) 8.0. D) 0.5. B) 2.0. C) 6.0. 21) If demand is price-elastic, then A) The elasticity number E is less than 1. C) The elasticity number E is greater than 1. B) The elasticity number E is equal to 1 D) The elasticity number E is 0. 22) A demand curve that is perfectly inelastic is A) Downward-sloping. C) Upward-sloping. B) Horizontal. D) Vertical. 23) If the price elasticity of demand for cigarettes is 0.4, A) A 10 percent increase in price will cause quantity demanded to fall by 40 percent. B) The demand is very inelastic. C)A 5 percent decrease in price will cause quantity demanded to rise by 10 percent. D) The demand is very elastic. 24) Which of the following products will have more inelastic demand? B) Medicines. D) Fresh flowers. C) New cars. A) Fast food. 25) Which of the following products will have elastic demand? A) Alcohol. C) Gasoline. B) European travel. D) Cigarettes. 26) Which of the following is not a determinant of the price elasticity of demand? A) The number of substitute goods available. B) The amount of income the consumer has. C) The time frame-whether it is in the short run or long run. D) The share ofa consumers budget. 9L89 2 008
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