1.Refer to the Elasticity and Taxes Graph. What is the tax burden on producers equal to? Elasticity and Taxes Graph GHAD 2.Consider a local Sunday farmers' market. Joe, a farmer, packs his small truck full of green peppers every Sunday morning and heads down to the market. The market is only open for 4 hours and it takes him about 2 hours to drive to the market from his farm. As well, it is not fuel efficient for him to return with any peppers after the market closes. Which of the following best describes Joe's supply curve for any day he is at the market? Perfectly inelastic. 3. Suppose the quantity of movie tickets sold decreases by 20 percent when the price increases by 10 percent. What can you conclude about the elasticity of demand over this price range? It is price elastic 4.As price increases by 1 percent, quantity supplied increases by 0.5 percent. What can you conclude about supply? Supply is inelastic 5. When Makena's income was $3000 per month, she went to the movies two times per month. Now that Makena's income is $3600 per month, she goes to the movies four times per month. Using the midpoint formula in your calculation, which of the following statements is true? Makena's income elasticity for the movies is approximately 3.67, and going to the movies is a normal good. 6.Which of the following best describes the cross-price elasticity between e-readers and e-books? It is a negative number. 7. Refer to Table 2 which contains demand data for organic protein bars. Which of the following is correct if the price of the protein bars increased from $4 to $5? Table 2 Total revenue would rise because in this price range demand is inelastic 8. Refer to Table 1 which contains demand data for organic protein bars. Which of the following is correct if the price of the protein bars increased from $5 to $6? Table 1 Total revenue would fall because in this price range demand is elastic 9. Refer to Figure 1. Which of the following correctly states the maximum possible revenue that can be obtained by a firm facing this demand curve? Figure 1 $2,000 10. A local pizzeria recently realized that, after raising its prices by 10%, its total revenue decreased by 30%. Which of the following is correct regarding the price elasticity of the demand at the point before the price increase? Assume demand is approximately linear and no other determinants of demand changed. It was elastic 11. A regional hockey team noticed that, after raising its seat price by 20%, its total revenue increased by 40%. Which of the following is correct regarding the price elasticity of the demand at the point before the price increase? Assume demand is approximately linear and no other determinants of demand changed. It was inelastic 12.suppose that a 5 percent increase in the price of gas causes a 2 percent drop in the use of gas and a 3 percent increase in sales of city transit tickets. What can you conclude about the demand for gas and its relationship to city transit tickets? The demand for gas is inelastic, and gas and city transit tickets are substitutes. 13.Suppose the elasticity of demand for tickets to a baseball game is -1.5, and the price increases by 10 percent. What will happen to the quantity demanded? It will increase by 15 percent 14.What is demand said to be when a 5 percent increase in price leads to a 10 percent reduction in quantity demanded? relatively elastic
