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Question
Reference: Ref 6-17
(Table: Johnson's Income and Expenditures) Look at the table Johnson's Income
and Expenditures. For Johnson, pizzas are:
a normal good.
258. Multiple Choice: What would happen in the market for c...
Question What would happen in the market for canned pinto beans if individuals' incomes
increased?
The cross-price elasticity between beans and other goods would be negative.
259. Multiple Choice: Which of the following would be most ...
Question Which of the following would be most likely to have a vertical supply curve?
Answer salt
260. Multiple Choice: Suppose the price of university sweat...
Question
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Suppose the price of university sweatshirts increases from $10 to $20 and the
quantity supplied increases from 20 to 30. The price elasticity of supply, using the
midpoint formula, is:
Answer 0.66.
261. Multiple Choice: A perfectly elastic supply curve is:
Question A perfectly elastic supply curve is:
vertical.
262. Multiple Choice: Suppose the price of real estate incr...
Question Suppose the price of real estate increases by 37.11% in Oakland next year. If the
quantity of new homes supplied does not change, this means that the price
elasticity of ________ will be perfectly ________ in Oakland next year.
Answer demand; elastic
263. Multiple Choice: If the quantity supplied responds sub...
Question If the quantity supplied responds substantially to a relatively small change in price,
supply is:
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264. Multiple Choice: If the price elasticity of supply is ...
Question If the price elasticity of supply is greater than 1, then:
the quantity supplied is relatively unresponsive to price changes.
265. Multiple Choice: If the price elasticity of supply is ...
Question If the price elasticity of supply is less than 1, then supply is:
Answer price-elastic.
266. Multiple Choice: The price elasticity of supply is com...
Question The price elasticity of supply is computed as the percentage change in the:
Answer quantity supplied divided by the percentage change in the quantity demanded.
267. Multiple Choice: An attorney supplies 40 hours of work...
Question An attorney supplies 40 hours of work per week when her fee is $100 per hour but
supplies 60 hours of work per week when her fee rises to $120 per hour. Using the
midpoint formula, her elasticity of supply is equal to:
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Answer 1.
268. Multiple Choice: A hotel has a capacity of 100 rooms. ...
Question A hotel has a capacity of 100 rooms. Which of the following statements best
describes the elasticity of supply for rooms at this hotel?
Answer The supply is elastic at quantities above 100 rooms but inelastic at quantities
below 100 rooms.
269. Multiple Choice: Paolo owns a pizza shop. The price of...
Question Paolo owns a pizza shop. The price of pizza recently increased from $3 to $5 a
slice. Paolo responded by increasing the quantity of slices he supplied from 100 to
150 slices per day. Using the midpoint method, calculate Paolo's price elasticity of
supply.
Answer 5/4
270. Multiple Choice: Figure: Supply Curves Reference: Ref ...
Question
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Figure: Supply Curves
Reference: Ref 6-18
(Figure: Supply Curves) Look at the figure Supply Curves. Which graph shows a
perfectly inelastic supply curve?
D
271. Multiple Choice: Figure: Supply Curves Reference: Ref ...
Question Figure: Supply Curves
Reference: Ref 6-18
(Figure: Supply Curves) Look at the figure Supply Curves. Which graph shows a
perfectly elastic supply curve?
Answer A
272. Multiple Choice: The price elasticity of supply for a ...
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Question The price elasticity of supply for a good is 3 if a:
Answer 1% increase in price leads to a 3% decrease in the quantity supplied.
273. Multiple Choice: The price elasticity of supply measures:
Question The price elasticity of supply measures:
Answer the response of a supply shift to changes in technology.
274. Multiple Choice: If the quantity supplied responds sub...
Question If the quantity supplied responds substantially to a relatively small change in price,
supply is:
insensitive to changes in price.
275. Multiple Choice: Which of the following statements is ...
Question Which of the following statements is true?
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If the price elasticity of supply is greater than 1, then the quantity supplied is
relatively unresponsive to price changes.
276. Multiple Choice: Which of the following statements is ...
Question Which of the following statements is true?
Answer If the price elasticity of supply is less than 1, then the supply is price-elastic.
277. Multiple Choice: Which of the following is likely to m...
Question Which of the following is likely to make supply more inelastic?
Answer The time period under consideration is very short.
278. Multiple Choice: The long-run price elasticity of supp...
Question The long-run price elasticity of supply of crude oil is ________ the short-run price
elasticity of supply of crude oil.
Answer less than
279. Multiple Choice: In the short run, the price elasticit...
Question
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In the short run, the price elasticity of supply for foods low in carbohydrates is
lower than it will be in the long run because:
Answer in the short run, inputs are more available to produce these foods than in the
long run.
280. Multiple Choice: Which factor is important in determin...
Question Which factor is important in determining the price elasticity of supply?
the number of alternative uses of the good
281. Multiple Choice: Supply curves tend to be more _______...
Question Supply curves tend to be more ________ the greater the time facing producers.
Answer price-inelastic
282. Multiple Choice: The supply curve for a good will be m...
Question The supply curve for a good will be more elastic if:
Answer spending on the good accounts for a large share of a consumer's income.
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283. Multiple Choice: It is very difficult for Julia to fin...
Question It is very difficult for Julia to find inexpensive and available inputs for her business.
Because of this, we predict that Julia's price elasticity of supply is:
Answer elastic.
284. Multiple Choice: Consider the market for strawberries....
Question Consider the market for strawberries. Which of the following statements most likely
applies to the strawberry market?
Answer The income elasticity of demand for strawberries is negative.
285. Multiple Choice: Figure: The Market for Lattes Referen...
Question
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Figure: The Market for Lattes
Reference: Ref 6-19
(Figure: The Market for Lattes) Look at the figure The Market for Lattes. What is
the price elasticity of demand between the prices of $2 and $2.50 per cup, using
the midpoint formula?
Answer 1
286. Multiple Choice: (Figure: The Market for Lattes) Look ...
Question (Figure: The Market for Lattes) Look at the figure The Market for Lattes. What is
the price elasticity of supply between the prices of $2 and $2.50 per cup, using the
midpoint formula?
3
287. Multiple Choice: Suppose the price of Vanilla Coke inc...
Question
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Suppose the price of Vanilla Coke increases by 9% and quantity demanded falls
by 13% overall but only by 4% for loyal Coca-Cola customers. This means that for
the general public there are ________ for Vanilla Coke, but for loyal Coca-Cola
customers, Vanilla Coke is more of ________ item. This means that Coca-Cola will
enjoy an increase in total revenue only from ________.
several substitutes; a necessity; the general public
288. Multiple Choice: A group of dairy farmers is trying to...
Question A group of dairy farmers is trying to raise milk prices by 10%. If the price elasticity
of demand for milk is 0.75 and the price elasticity of supply for milk is 0, then by
how much should farmers reduce their milk production to obtain the 10% increase?
Answer 10%
289. Multiple Choice: If an increase in the price of a good...
Question If an increase in the price of a good leads to an increase in total revenue, then:
Answer the supply curve is price inelastic.
290. Multiple Choice: Suppose the price elasticity of deman...
Question Suppose the price elasticity of demand for blueberries is 1.5. If climate change
destroys one-fourth of the nation's blueberry crop (and thus reduces supply), how
will that affect total revenue, all other things unchanged?
Answer Total revenue will rise.
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291. Multiple Choice: The price elasticity of demand for ga...
Question The price elasticity of demand for gasoline in the short run has been estimated to
be 0.1. If a war in the Middle East causes the price of oil (from which gasoline is
made) to increase, how will that affect total expenditures on gasoline in the short
run, all other things equal?
Answer Demand will stay the same, but total expenditures will fall.
292. Multiple Choice: The price elasticity of demand for ca...
Question The price elasticity of demand for cabbage has been estimated to be 0.25. If an
insect infestation destroys 20% of the nation's cabbage crop (and thus reduces
supply), how will that affect total expenditures on cabbage, all other things equal?
There is not enough information is given to answer the question.
293. Multiple Choice: The price elasticity of demand for so...
Question The price elasticity of demand for soft drinks has been estimated to be 0.55. If the
government enacts a major increase in the tax on imported sugar (a major
ingredient in soft drink manufacture), how will that affect total expenditures on soft
drinks, all other things equal?
Answer Total expenditures will remain unchanged.
Total expenditures will fall.
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294. Multiple Choice: The price elasticity of demand for gr...
Question The price elasticity of demand for ground beef has been estimated to be 1.0. If mad
cow disease strikes the United States and a large percentage of the cattle are
removed from the market, how will that affect total expenditures on hamburger, all
other things equal?
295. Multiple Choice: Assume the price elasticity of demand...
Question Assume the price elasticity of demand for corn has been estimated to be 2.33.
Flash floods destroy 10% of the nation's crop of corn. Which of the following best
describes how this will affect total expenditures on beans, all other things equal?
Answer Total expenditures will remain unchanged.
296. Multiple Choice: The price elasticity of demand for fr...
Question The price elasticity of demand for fresh zucchini has been estimated to be 2.25. A
new irrigation system yields a 25% increase in the nation's crop of fresh zucchini.
Which of the following best describes how this will affect total expenditures on
zucchini, all other things equal?
Answer Total expenditures will remain unchanged.
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297. Multiple Choice: The price elasticity of demand for mi...
Question The price elasticity of demand for milk has been estimated to be somewhere
between 0.49 and 0.63. If a new system of feeding and milking cows yields a 15%
increase in the production of milk throughout the country, how will that affect total
expenditures on milk, all other things equal?
Answer Total expenditures will remain unchanged.
298. Multiple Choice: The price elasticity of demand for ga...
Question The price elasticity of demand for gasoline in the long run has been estimated to be
1.5. If an extended war in the Middle East caused the price of oil (from which
gasoline is made) to increase and remain high for a decade, how would that affect
total expenditures on gasoline in the long run, all other things equal?
Answer Total expenditures would rise.
299. Multiple Choice: Assume the price elasticity of demand...
Question Assume the price elasticity of demand for tobacco is 0.5 and the income elasticity
of demand for tobacco is 0.4. Then:
Answer an increase in the price of tobacco will decrease total revenue from sales of
tobacco.
300. Multiple Choice: A price floor will cause a larger sur...
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