The larger the proportion of income spent on a product, other things equal, the: more unit...
The larger the proportion of income spent on a product, other things equal, the:
|
more unit elastic is a consumer's demand. |
|
|
more elastic is a consumer's demand. |
|
|
more inelastic is a consumer's demand. |
|
|
more vertical is a consumer's demand curve. |
Which of the following pairs of goods would most likely exhibit a
cross price elasticity of -1.8?
|
orange juice and grapefruit juice |
|
|
coffee and tea |
|
|
a bagel and cream cheese |
|
|
a van and a sport utility vehicle |
Ceteris paribus, if an 6% increase in quantity supplied is caused by an 8% increase in price, then:
|
supply is elastic. |
|
|
supply is unit elastic. |
|
|
supply is inelastic. |
|
|
the supply curve is perfectly vertical. |
Homework Answers
1. More elastic is a consumer's demand.
Explanation: When larger proportion of the income is spent on a good, it will have a more elastic demand as the % change in quantity would be greater than the % change in price.
2. A bagel and cream cheese
Explanation: Complementary goods have negative cross price elasticity of demand.
3. supply is inelastic.
Explanation: Supply is inelastic when the % change in quantity is lower than the % change in price.
Add Answer to:
The larger the proportion of income spent on a product, other
things equal, the:
more unit...
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