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# Suppose that when price is \$10, quantity supplied is 20. When price is \$6, quantity

Suppose that when price is \$10, quantity supplied is 20. When price is \$6, quantity
supplied is 12. The price elasticity of supply is

a.0.2

b.0.5

c.1.0

d.1.5

e.2.0

102.              The price elasticity of supply for the market-day supply curve of fish is

a.equal to zero

b.equal to one

c.less than one

d.more than one

e.less than zero

103.              Because suppliers can more readily adjust their output in the long run than in the short
run, we expect price elasticity of supply to be

a.negative in the long run and positive in the short run

b.positive in the long run and negative in the short run

c.greater than one in the short run and less than one in the long run

d.higher in the long run than in the short run

e.higher in the short run than in the long run

104.              The price elasticity of supply for toys is 0.36, so that a 1 percent increase in price would
generate a

a.0.36 percent increase in quantity supplied

b.3.60 percent increase in quantity supplied

c.0.36 percent decrease in quantity supplied

d.3.60 percent decrease in quantity supplied

e.1.36 percent increase in quantity supplied

106.              To raise the most tax revenue, governments should consider taxing goods whose

a.income elasticity of demand is high

b.price elasticity of demand is low

c.income elasticity of supply is low

d.income elasticity of demand is high

e.cross elasticity of demand is positive

107.              The price elasticity of demand for gasoline is 0.27 and for wine is 2.9. If the government
had the choice of taxing only one, which of the following should it choose?

a.tax gasoline

b.tax wine

c.tax neither, but raise the price elasticity of demand for each

d.tax neither, but lower the price elasticity of demand for each

e.tax neither, but raise the price elasticity of demand for gasoline and lower it for wine

108.              Price elasticities of supply are always

a.equal to price elasticities of demand when the market is in equilibrium

b.negative

c.positive

d.greater than one

e.less than one

109.              The price elasticity of demand for a good is influenced by which of the following factors?

a.the responsiveness to changes in income

b.the cost of resources to produce the good

c.the availability of substitutes

d.the level of competition among sellers

e.the number of uses for the good

110.              Elasticity is a useful tool in learning more about the character of demand. It depicts

a.the way to find market equilibrium

b.a ratio of percentage changes

c.how easily prices adjust to changing market (supply and demand) conditions

d.how price changes as quantity demanded changes

e.how consumers react to shifts in demand

Dec 09 2019 View more View Less