Question

on, o s who we near a bus new sportation podes a Wios ve four, a w ay on the crowdes a wooden Sprice elasticity of demand bawang b.2010 ortation is Yose. o) a 6. wch of the following als 5000s owing pairs of goods is Way to t y vo Nasticity of demand? a. Orange juice and grape S, hot dogs and hamburgers g et banca d. peanus d oo 2. in order to have and Fishermans are substitutes, one should measure the and get a a. CTOSS-price elasticity, negative number b. price elasticity of demand number less than in c. price elasticity of demand number greater than d. Cross-price elasticity, positive number 33. A firm finds that a 4 percent increase in the price that changes i na2 percent increase in the quantity supplied of the good produces Clothe price elasticity of supply and characterize the product a. 2; The product is elastic 5.02. The productions c. 50%; The product is inelastic d. 05. The producties 34. Anipuk's Unbelievable Umbrellas knows that the price elasticity of supply for its umbrellas is 2. What percentage change in the price of umbrellas would result in a 30 percent increase in the quantity supplied? a. 6.7 percent b. 15 percent c. 60 percent d. impossible to determine without additional information Soberany Bufory530 35. Which of the statements below best describes the concept of consumer Surplus? a. I paid $130 for a printer last week. This week the same store is selling the same printer for $110." b. "Sobeys was having a sale on Chapman's ice cream so I bought 6ltres." C. "I sold my Blu-ray copy of Avatar for $18 at a garage sale, even though I was willing to sell it for $10." d. "I was all ready to pay $300 for a new leather jacket that I had seen in Hudson's Bay, but I ended up paying only $180 for the same jacket because it was on sale 36. Assume that Steven K. buys a new circular saw at Hardware House for a prie $85 even though he was willing to pay $120. The marginal cost of the sex Which of the following statements is NOT true? a. Producer surplus is $40. b. The lowest price that Hardware House would sell the saw for wo c. The producer surplus is $35 and the consumer surplus S40 d. The marginal benefit of the saw to Steven K. is $120.

Answer 1

31.

B

Negative cross price elasticity, means goods are compliment to each other. It is the case with pancake and maple syrup.

32.

D

Cross price elasticity, should be measured and it should be positive for being substitutes.

33.

D

Price elasticity of supply = % increase in quantity supplied / % increase in price = 2%/4%

Price elasticity of supply = .5

Since Price elasticity of supply is less than 1, then it is inelastic in nature.

34.

B

% increase in price required = 30%/2 = 15%

35.

D

Here, price is less than the price willing to be paid by the consumer.