This quiz works best with JavaScript enabled. Home > Microeconomics > Elasticity > Elasticity Of Demand – Quiz 8 🏠 Homepage 📘 Download PDF Books 📕 Premium PDF Books Elasticity Of Demand Quiz 8 (20 MCQs) Quiz Instructions Select an option to see the correct answer instantly. 1. Question 10The demand for food is most elastic in countries ..... A) With intermediate income levels. B) That are highly urbanized. C) With high income levels. D) With low income levels. Show Answer Correct Answer: D) With low income levels. 2. PED is-1.5 and the firm raises price by 4%. What happens to total revenue? A) Total revenue decreases. B) Total revenue increases. C) Total revenue stays the same. D) Total revenue decreases by 4%. Show Answer Correct Answer: A) Total revenue decreases. 3. A consumer spends Rs 250 on a good when its price is Rs 5 per unit. When the price rises to Rs 6 per unit he spends Rs 240 .Calculate Rs Ed A) -2. B) -1. C) -4. D) -3. Show Answer Correct Answer: B) -1. 4. The income elasticity of demand for a normal good is always what? A) Negative/less than 1. B) Positive/greater than 1. C) Negative/less than 0. D) Positive/greater than 0. Show Answer Correct Answer: D) Positive/greater than 0. 5. A good has a unitary price elasticity of demand and at a price of $ 20 a firm sells 40 000 units.How many will the firm sell if it charges a price of $ 5? A) 10 000. B) 100 000. C) 160 000. D) 200 000. Show Answer Correct Answer: C) 160 000. 6. How many categories of YED exits? A) Five. B) Three. C) One. D) Four. Show Answer Correct Answer: D) Four. 7. The Law of Demand "works" because of a combination of what two effects? A) Substitution and Income Effects. B) Doppler and Lake Effects. C) The Ability and Desire Effect. D) The Substitution and Elasticity Effect. Show Answer Correct Answer: A) Substitution and Income Effects. 8. The formula for price elasticity of demand is ..... A) % change in Qd / % change in Price. B) % change in Price / % change in Qd. C) Change in quantity / Change in price. D) % change in price / % change in income. Show Answer Correct Answer: A) % change in Qd / % change in Price. 9. Wheat has seen a decrease in demand of 5%, while the price has increased 7%. The PED is: A) 1.4 inelastic. B) 1.4 elastic. C) .71 inelastic. D) .71 elastic. Show Answer Correct Answer: C) .71 inelastic. 10. The price elasticity of demand generally tends to be: A) Smaller in the long run than in the short run. B) Smaller in the short run than in the long run. C) Larger in the short run than in the long run. D) Unrelated to the length of time. Show Answer Correct Answer: B) Smaller in the short run than in the long run. 11. Assume a pizza costs $ 10. When the price increases to $ 12, demand falls 10%. What is the own-price elasticity of demand? Note:in economics, elasticity is generally reported as a positive number even when it is negative. A) 5. B) .5. C) 2. D) .2. Show Answer Correct Answer: B) .5. 12. A company sells solar batteries. Last year income rose by 2% as a result demand increased from 1.6million units to 1.8 million. What is the YED? A) 5.2. B) -6.6. C) 4.3. D) 6.25. Show Answer Correct Answer: D) 6.25. 13. The formula for the price elasticity of demand uses which of the following in the denominator? A) The average price of the product. B) The quantity demanded for the product. C) The percentage of change in the price of the product. D) The change in the quantity demanded. Show Answer Correct Answer: C) The percentage of change in the price of the product. 14. To determine elasticity of demand economist use a ..... A) Chart. B) Formula. C) None of the above. D) None of above. Show Answer Correct Answer: B) Formula. 15. A price cut from $ 2 to $ 1.50 causes the demand for peas to rise from 10.000 units to 11.500 units. What is the price elasticity of demand for peas? A) -3, 0. B) -0, 6. C) +3, 0. D) +0, 6. Show Answer Correct Answer: B) -0, 6. 16. Electricity has seen a decrease in demand of 14%, while the price has increased 18% A) 1.3 inelastic. B) 1.3 elastic. C) .78 inelastic. D) .78 elastic. Show Answer Correct Answer: C) .78 inelastic. 17. Describe your demand for medicine if you buy the same amount of it after a large price increase. A) Elastic. B) Unitary elastic. C) Perfectly inelastic. D) Hyper elastic. Show Answer Correct Answer: C) Perfectly inelastic. 18. If a rise in the price of good 1 decreases the quantity of good 2 demanded, A) The cross elasticity of demand is negative. B) Good 1 is an inferior good. C) Good 2 is an inferior good. D) The cross elasticity of demand is positive. Show Answer Correct Answer: A) The cross elasticity of demand is negative. 19. The cross-elasticity of demand for good X with respect to good Y is-0.5.What can be concluded from this? A) Goods X and Y are complementary goods. B) Goods X and Y are substitute goods. C) Good X is an inferior good. D) Good Y is an inferior good. Show Answer Correct Answer: A) Goods X and Y are complementary goods. 20. If the price elasticity of supply is 0.2, and a price increase led to a 3% increase in quantity supplied, then the price increase is about A) 0.07%. B) 0.60%. C) 6%. D) 15%. Show Answer Correct Answer: D) 15%. ← 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 9Elasticity Of Demand Quiz 10 🏠 Back to Homepage 📘 Download PDF Books 📕 Premium PDF Books