Question 1 The basic structure of every elasticity measure is a. the percentage change in price that results from a one-percent change in quantity demanded. b. the percentage change in quantity demanded that results from a ten-percent change in price. c. the percentage change in quantity demanded that results from a one-percent change in (price/income/price of related good).

Question 2 A research article includes the line "While a relatively wide range of estimates has been produced for the price elasticity of demand for cigarettes, most of the estimates from the USA and other high income countries tend to fall in the relatively narrow range from ?0.25 to ?0.50." This means that if the price of cigarettes were to decrease 10%, the quantity of cigarettes demanded would a. decrease by 2.5% to 5.0%. b. increase by 2.5% to 5.0%. c. increase by 0.25% to 0.50%. ? Question 3 The same research article includes the line " the overall price elasticity of teen smoking was ?1.44. This was more than three times the estimated elasticity of ?0.42 obtained from the study of adults." This implies that a. teenagers will purchase much fewer cigarettes if prices rise than adults, who will only reduce their purchases a minor amount. b. teenagers are willing to pay more than three times as much for cigarettes as adults. c. teenage cigarette demand is inelastic, while adult cigarette demand is elastic.

Question 4

The point elasticity for the demand function at the ($10, 65) point is a. ?3.5 $10/65 = ?0.538 b. ?3.5 65/$10 = ?22.75 c. 100 ? 3.5(10) = 65 d. $10 $10/65 = 1.538

Question 5

You overhear an economist saying that the demand for magnesium groovehelmets is inelastic. This means that a given price change will induce a large quantity demand response. a. True b. False Question 6 At its current price, demand for magnesium groove helmets is inelastic. If its price were to decrease, total revenue would be expected to rise. a. True b. False

Question 7

Which product would tend to have the most elastic demand? a. A penthouse apartment across the street from Central Park in New York City. b. An Almond Joy (coconut, almonds, and chocolate) candy bar. c. A refrigerator that is needed after your old one unexpectedly stops working. d. A typical three-bedroom, two-bathroom home in the suburbs.

3.pdf - Adobe Acrobat Pro X File Edit View Window Help * Create Customize + 139% Tools Sign Comment Use the table below for the following questions: W A table of sales, total revenue, and marginal revenue. Q (sales) Total revenue Marginal revenue 0 0 0 15 15 N 28 13 40 50 10 57 55 -2 18 50 -5 9 -10 10 28 -12 Type here to search O 3:49 PM 11/9/2021A linear trend equation for sales of the form Qt = 0- + b: was estimated using annual sales data for the period 2003 - 2010 (Le, t= 2003, 2004, ..., 2010). The results of the regression are as follows: Observations: 3 0.7034 14.23 0.0093