This quiz works best with JavaScript enabled. Home > Microeconomics > Elasticity > Elasticity Of Demand – Quiz 14 🏠 Homepage 📘 Download PDF Books 📕 Premium PDF Books Elasticity Of Demand Quiz 14 (20 MCQs) Quiz Instructions Select an option to see the correct answer instantly. 1. .If demand is price elastic, then: A) A rise in price will raise total revenue. B) A fall in price will raise total revenue. C) A fall in price will lower the quantity demanded. D) A rise in price won't have any effect on total revenues. Show Answer Correct Answer: B) A fall in price will raise total revenue. 2. Demand for a product is likely to be price inelastic the ..... A) Fewer substitutes it has. B) Fewer complements it has. C) Higher its market price. D) Greater the proportion of income spent on it. Show Answer Correct Answer: A) Fewer substitutes it has. 3. Price X Quantity = A) Total revenue. B) Price elasticity of demand. C) Price elasticity of supply. D) Trade deficits. Show Answer Correct Answer: A) Total revenue. 4. Water has seen an increase in demand 8% this summer, while the price has decreased 12%. The PED is: A) 1.5 inelastic. B) 1.5 elastic. C) .67 inelastic. D) .67 elastic. Show Answer Correct Answer: C) .67 inelastic. 5. If price rises and total revenue stays the same the demand is A) Inelastic. B) Unitary. C) Elastic. D) None of above. Show Answer Correct Answer: B) Unitary. 6. When is the price elasticity of demand for a good likely to be greater than one? A) When expenditure on the good is a small part of total expenditure. B) When the good has few uses. C) When the good is habit-forming. D) When there are many substitutes for the good. Show Answer Correct Answer: D) When there are many substitutes for the good. 7. Question 6Ali's income has just risen from RM940 per week to RM1, 060 per week. As a result, he decides to purchase 9 percent more steak per week.The income elasticity of Ali's demand for steak is? A) 0.75. B) 1.00. C) 1.33. D) 0.90. Show Answer Correct Answer: A) 0.75. 8. Gasoline is inelastic on the short and the long run because ..... A) It is very expensive. B) We depend on oil to make it. C) There are very few subtitutes to gasoline. D) None of above. Show Answer Correct Answer: C) There are very few subtitutes to gasoline. 9. The price of Good X rises by 20%. As a result, the demand for a substitute Good Y rises by 10%.What is the cross-elasticity of demand for Good Y with respect to Good X? A) + 2. B) + 0.5. C) -0.5. D) -2. Show Answer Correct Answer: C) -0.5. 10. A product has a price elasticity of demand that is greater than one. What will happen to total revenue if the price of the product is reduced by 3%? A) It will fall by more than 3%. B) It will fall to zero. C) It will be unchanged. D) It will rise. Show Answer Correct Answer: D) It will rise. 11. When Elasticity is higher than 1, this is ..... A) Inelastic. B) Elastic. C) Unit Elastic. D) None of above. Show Answer Correct Answer: B) Elastic. 12. Water has seen an increase in demand 8% this summer, while the price has decreased 12% A) 1.5 inelastic. B) 1.5 elastic. C) .67 inelastic. D) .67 elastic. Show Answer Correct Answer: C) .67 inelastic. 13. Supermarket branded Baked Beans A) Normal Good. B) Inferior Good. C) Luxury Good. D) None of above. Show Answer Correct Answer: B) Inferior Good. 14. A 10 percent decrease in the price of a Pepsi decreases the demand for a Coca-Cola by 50 percent. The cross elasticity of demand between a Pepsi and Coca-Cola is: A) 50. B) 0.20. C) 10. D) 5. Show Answer Correct Answer: D) 5. 15. If Price and Total Revenue have a direct relationship A) Inelastic. B) Elastic. C) Unit elastic. D) None of above. Show Answer Correct Answer: A) Inelastic. 16. Inelastic demand is when PED = A) 1. B) 1>. C) Infinite. D) <1. Show Answer Correct Answer: D) <1. 17. Ford Trucks have seen a increase in demand of 27%, while the price has decreased 15% A) .56 inelastic. B) .56 elastic. C) 1.8 inelastic. D) 1.8 elastic. Show Answer Correct Answer: D) 1.8 elastic. 18. Which of the following is NOT a factor of Demand elasticity? A) Price relative to income. B) Availability of substitutes. C) Want vs. Need. D) Long-term time period of purchasing. Show Answer Correct Answer: D) Long-term time period of purchasing. 19. A 10% increase in the price of movie ticket in Westridge 8 leads to a 15% decrease in the number of tickets sold, indicating the demand for movie ticket in Westridge 8 is: A) Elastic. B) Inelastic. C) Unit elastic. D) Can not tell from the information given. Show Answer Correct Answer: A) Elastic. 20. Because of the law of demand, PED is always A) Negative. B) Zero. C) Positive. D) Infinite. Show Answer Correct Answer: A) Negative. ← 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