1. Define the difference between Price Elasticity of Demand vs. Income Elasticity of Demand.

2. List and explain the four determinants of price elasticity of demand discussed in this chapter.

3. What does an elasticity of > 1 or < 1 imply both with elasticity of demand or supply?

4. Explain why De Beers raised its prices while Walmart lowers its price. Are they both mad? Explain.

5. A storm hits soy bean farmers hard. Would this affect farmers more or less if the demand curve was elastic or inelastic? Explain both scenarios and why. You may like to draw your own curves before answering this question. Always draw demand and supply curves whenever possible and your study of economics will improve.