1. Suppose that the price of product X rises by 6 percent and the quantity supplied of X increases by 3 percent. The coefficient of price elasticity of supply for good X is

a. negative, and therefore X is an inferior good.

b. positive, and therefore X is a normal good.

c. less than 1, and therefore supply is inelastic.

d. more than 1, and therefore supply is elastic.

2.The price elasticity of demand for widgets is 1.5. Assuming no change in the demand curve for widgets, an increase in sales of 12 percent implies a(n)

a. 13.5 percent reduction in price.

b. 18 percent reduction in price.

c. 8 percent reduction in price.

d. 10.5 percent reduction in price.

3.The price elasticity of demand for widgets is 0.4. Assuming no change in the demand curve for widgets, a 6 percent decrease in sales implies a(n)

a. 13.5 percent increase in price.

b. 18 percent increase in price.

c. 15 percent increase in price.

d. 2.4 percent increase in price.

4.If a firm can sell2,000 units of product A at $12 per unit and3,000 at $9, then

a. the price elasticity of demand is approximately 0.71.

b. A is a complementary good.

c. the price elasticity of demand is approximately 1.4.

d. A is an inferior good.