05 ECONOMICS QUESTIONS AND GRADED ANSWERS, 100%
GUARANTEE
Billy Bob's Barber Shop knows that a 5 percent increase in the price of their haircuts results in a
15 percent decrease in the number of haircuts purchased. What is the elasticity of demand facing
Billy Bob's Barber Shop? - 3.0
Youth smoking seems to be more __________ than adult smoking—that is, the quantity of youth
smoking will fall by a greater percentage than the quantity of adult smoking in response to a
given percentage increase in price. - elastic
If the supply curve for a product is vertical, then the elasticity of supply is: - equal to zero
When economists are sketching examples of demand and supply, it is common to sketch a
demand or supply curve that is close to vertical, and then to refer to that curve as _________. -
inelastic
A demand or supply curve with ______________ would be horizontal in appearance. -
infinite elasticity
A perfectly elastic supply curve is: - horizontal
If the supply curve for housing is perfectly inelastic, then a reduction in demand will cause the
equilibrium price to: - fall and the equilibrium quantity to stay the same
A price cut will increase the total revenue a firm receives if the demand for its product is: -
elastic
The evidence on the supply curve of financial capital is controversial, but at least in the short
run, the elasticity of savings with respect to the interest rate appears to be __________. -
inelastic
GUARANTEE
Billy Bob's Barber Shop knows that a 5 percent increase in the price of their haircuts results in a
15 percent decrease in the number of haircuts purchased. What is the elasticity of demand facing
Billy Bob's Barber Shop? - 3.0
Youth smoking seems to be more __________ than adult smoking—that is, the quantity of youth
smoking will fall by a greater percentage than the quantity of adult smoking in response to a
given percentage increase in price. - elastic
If the supply curve for a product is vertical, then the elasticity of supply is: - equal to zero
When economists are sketching examples of demand and supply, it is common to sketch a
demand or supply curve that is close to vertical, and then to refer to that curve as _________. -
inelastic
A demand or supply curve with ______________ would be horizontal in appearance. -
infinite elasticity
A perfectly elastic supply curve is: - horizontal
If the supply curve for housing is perfectly inelastic, then a reduction in demand will cause the
equilibrium price to: - fall and the equilibrium quantity to stay the same
A price cut will increase the total revenue a firm receives if the demand for its product is: -
elastic
The evidence on the supply curve of financial capital is controversial, but at least in the short
run, the elasticity of savings with respect to the interest rate appears to be __________. -
inelastic
