18. If the elasticity of demand is perfectly elastic, any increase in the price of good may cause the quantity demanded to be A. zero B. increase C. negative D. infinite PEC1133 38 MICROECONOMICS Chapter 3: Elasticity 19. A family with an income of RM20,000 per annum purchase 100 units of a good per month. The family's income rises to RM25,000 per annum and income elasticity of demand is -2 for this good. What is the new quantity purchased each month? A. 50 B. 75 C. D. 200 20. If the price of an egg is reduced from RMO.25 to RMO.20, the quantity demanded by consumers will increase from 10 dozens per week to 12 dozens per week. The price elasticity of demand is A. 0.04 B. 4.8 C. 0.8 D. 1.0 21. If the income elasticity of demand for butter is 0.3, this means that A. butter is a substitute of margarine B. butter is a normal product C. butter is an inferior product D. butter is complementary of salt 22. If your income increase by 10% and the quantity demanded increase by 20%, the income elasticity of demand for chicken is_ A. -2 B. 0.5 C. 10% D. 2 23. If the supply of the commodity is price inelastic, then a small percentage increase in price leads to A. a larger percentage increase in the quantity . a smaller percentage increase in the quantity no change in quantity D. a proportionate change in quantity 24. When the price of good Y changes by 25%, the cross elasticity of demand for good X is 2. Thus if the original demanded good X is 30 units, find the new quantity demanded good X. A. 15 units B. 20 units C. 45 units D. 54 units