This quiz works best with JavaScript enabled. Home > Microeconomics > Elasticity > Elasticity Of Demand – Quiz 10 🏠 Homepage 📘 Download PDF Books 📕 Premium PDF Books Elasticity Of Demand Quiz 10 (20 MCQs) Quiz Instructions Select an option to see the correct answer instantly. 1. In the short run, price elasticity may be, because of a lack of substitutes for example, relatively A) Elastic. B) Inelastic. C) Unit elastic. D) None of above. Show Answer Correct Answer: B) Inelastic. 2. If the price elasticity of demand for a product is 2.5 and its price has increased by 3%, we can conclude that the quantity demanded: A) Increased by 7.5%. B) Decreased by 3%. C) Decreased by 7.5%. D) Increased by 2.5%. Show Answer Correct Answer: C) Decreased by 7.5%. 3. If a seller knows that the demand for his good or service is inelastic, then what would they most likely do? A) Increase the price. B) Try to make their product elastic. C) Keep the price the same. D) Decrease the price. Show Answer Correct Answer: A) Increase the price. 4. Which one of the following effects on elasticity is the odd one out? A) If a product/service is a necessity. B) None addictive. C) If a product/service has no substitutes. D) If a product/service has good brand image. Show Answer Correct Answer: B) None addictive. 5. The price of a commodity is Rs 15 per unit and its quantity demanded is 500 units. Its quantity demanded rises by 80 units as a result of a fall in its price by 20 %.Calculate Ed A) -1. B) -0.8. C) -0.5. D) -0.6. Show Answer Correct Answer: B) -0.8. 6. What does the elasticity of demand measures? A) How the changes in prices affect global economy. B) How customers react to changes in prices. C) How customers react to changes in quality. D) None of above. Show Answer Correct Answer: B) How customers react to changes in prices. 7. The amount that consumers spend on a product at a particular price A) Marginal utility. B) Demand. C) Total expenditures. D) None of above. Show Answer Correct Answer: C) Total expenditures. 8. What is most likely to increase the demand for compact disc players? A) A fall in disposable incomes. B) A fall in the price of cinema tickets. C) A fall in the price of compact discs. D) A fall in the price of video recorders. Show Answer Correct Answer: C) A fall in the price of compact discs. 9. A good is considered relatively inelastic if the elasticity of demand is ..... A) 0. B) Equal to 1. C) Less than 1. D) Greater than 1. Show Answer Correct Answer: C) Less than 1. 10. It is reasonable to expect the cross price elasticity of demand for golf clubs and golf balls to be positive A) True. B) False. C) Uncertain. D) None of above. Show Answer Correct Answer: B) False. 11. Good X is a substitute for good Y and a complement to good Z. What would happen after a fall in the price of good X? A) Only the demand for X will rise. B) Demand for X, Y and Z will rise. C) Demand for Y will fall and for Z will rise. D) Demand for Y will rise and for Z will fall. Show Answer Correct Answer: C) Demand for Y will fall and for Z will rise. 12. What type of good would have a YED = 2 A) Luxury. B) Necessity. C) Inferior. D) None of above. Show Answer Correct Answer: A) Luxury. 13. A product has perfectly inelastic price elasticity of demand. What will happen to total revenue if the price of the product rises by 10%? A) It will fall by 10%. B) It will fall to zero. C) It will remain unchanged. D) It will rise by 10%. Show Answer Correct Answer: D) It will rise by 10%. 14. Which of the following scenarios would indicate inelastic demand with respect to price? A) Price falls 5% demand rises 3%. B) Price rises 5% and demand rises 3%. C) Price falls 5% and demand rises 10%. D) Price rises 5% and demand rises 10%. Show Answer Correct Answer: A) Price falls 5% demand rises 3%. 15. When the quantity demanded changes by a smaller percentage than the price, demand is said to be A) Elastic. B) Inelastic. C) Unit elastic. D) None of above. Show Answer Correct Answer: B) Inelastic. 16. An increase in Azad's income decreases her demand for cassette tapes. For her, cassette tapes are A) A complement to any good. B) A normal good. C) An inferior good. D) A substitute good. Show Answer Correct Answer: C) An inferior good. 17. Question 5A cut in price of Product A from RM1.50 to RM1.20 sees demand for a product rise by 10%. What would the price elasticity of demand be for this product? A) 3.00. B) 1.00. C) 2.00. D) -0.50. Show Answer Correct Answer: D) -0.50. 18. If price elasticity of demand coefficient ratio is 3, demand is A) Relatively elastic. B) Relatively inelastic. C) Perfectly elastic. D) Perfectly inelastic. Show Answer Correct Answer: A) Relatively elastic. 19. A consumer buys 10 units of good x at a price of Rs 5 per unit. The price elasticity of demand for this demand for this good is 2 . Price falls to Rs 4 per unit. How many units of good X will he now buy at this price? A) 14. B) 15. C) 16. D) 17. Show Answer Correct Answer: A) 14. 20. Suppose there is a 6% increase in the price of good X and a resulting 6% decrease in the quantity of X demanded. Price elasticity of demand for X is A) 0. B) 1. C) 6. D) 36. Show Answer Correct Answer: B) 1. ← PreviousNext →Related QuizzesMicroeconomics QuizzesElasticity Of Demand Quiz 1Elasticity Of Demand Quiz 2Elasticity Of Demand Quiz 3Elasticity Of Demand Quiz 4Elasticity Of Demand Quiz 5Elasticity Of Demand Quiz 6Elasticity Of Demand Quiz 7Elasticity Of Demand Quiz 8Elasticity Of Demand Quiz 9 🏠 Back to Homepage 📘 Download PDF Books 📕 Premium PDF Books