BR6A: Bridge: Elasticity of Demand
Question 1
Many new restaurants have opened in Collegetown in recent years. Given this change in supply, what type of demand would result from a large drop in prices for restaurant meals?
A. Elastic demand
B. Inelastic demand
C. A drop in prices does not affect demand.
Answer
B. Inelastic demandQuestion 2
Which of the following goods would likely be very inelastic?
A. Medication for a sick pet.
B. A condo on the beach.
C. A new sofa.
D. A gourmet box of chocolates.
Answer
A. Medication for a sick pet.Question 3
If demand for a good is inelastic, what would the demand curve for this good look like?
A. It would be completely horizontal.
B. It would be upward sloping.
C. It would be downward sloping and relatively steep.
D. It would be downward sloping and relatively flat.
Answer
C. It would be downward sloping and relatively steep.Question 4
Since there are many different brands of tablet computers to choose from, the elasticity of demand for the tablet market is:
A. elastic.
B. unitary elastic.
C. perfectly inelastic.
D. inelastic.
Answer
A. elastic.Question 5
If the Sunset Café reduces their prices by 20%, and the number of customers increases by 40%, what is the elasticity of demand?
A. 20
B. 2.0
C. 0.5
D. 40