Multiple choice

5. When measuring the change in quantity demanded of one good against the price change in another good, we are describing?

a. price elasticity

b. income elasticity

c. cross price elasticity

d. income density

6. When government imposes a binding price ceiling on a competitive market?

a. a surplus of the good arises

b. a shortage of the good arises

c. the slope of the demand curve generally flattens and becomes more inelastic

d. quantity supplied of a good will exceed quantity demanded