If consumers are price sensitive, then A. they will have elastic demand curves.

Question

If consumers are price sensitive, then A. they will have elastic demand curves. B. they will have inelastic demand curves. C. they will have no demand curve D. they will not shop around very much. 17.) 18.) If elasticity of demand is 4 and price is raised total revenue will rise. C. total revenue will remain constant. D. there is no way to determine whether total revenue will rise, fal constant. evenue will rise, fall, or remain constant. 19.) Demand is inelastic if the percentage change in quantity demanded is greater than the perc e percentage A. B. C. D. change in price. the elasticity of demand is less than 1. the demand for the good is sensitive to changes in price. more units will be purchased if the price increases. Which is NOT a determinant of the elasticity of demand? A. 20.) The proportion of income consumers spend on the good The number of sellers B. C. D. The availability of substitutes Time 21.) Which of these has the most elastic demand? A. Filet Mignon steak B. Bread C. Heart medicine D. Insulin (diabetes medicine) 22.) If an increase in price leads to a decrease in total revenue, A. demand is elastic. B. demand is inelastic. C. D. demand is unit elastic. there is not enough information to determine the elasticity of demand. 23,) If the income elasticity for Ramen Noodles is-3.0, we may conclude that Ra Noodles are A. a normal good B. a inferior good C. both a normal good and an inferior good D. neither a normal good nor an inferior good

Explanation / Answer

17. A) they will have elastic demand curves

if a change in price leads to a bigger percentage change in demand then demand is price elastic. The value of PED in that case will be greater than one.

19. B) the elasticity of demand is less than 1

If it is less than one, the curve is said to be inelastic and it is a demand whose percentage change is less than a percentage change in price.

20. B) the number of sellers

The determinants of price elasticity of demand are:

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