If the disposable income increases by 5% and the income elasticity of demand is 0,5, what change in demand would we expect to see? 4. a) 10% b) 5% c) -5% d) 2,5% If a decrease in price does not lead to an increase in revenue, we might conclude that the demand for this product is? 5. a) Price inelastic b) Income inelastic c) Price elastic d) Income elastic If the price elasticty of demand for a good is -2.5 and the firm cuts the price of this good by 5%, what change would we expect to see in the demand for this product? 6. a) Increase of 2% b) Increase of 12,5% c) Increase of 0,5% d) Increase of 10%
If the disposable income increases by 5% and the income elasticity of demand is 0,5, what change in demand would we expect to see? 4. a) 10% b) 5% c) -5% d) 2,5% If a decrease in price does not lead to an increase in revenue, we might conclude that the demand for this product is? 5. a) Price inelastic b) Income inelastic c) Price elastic d) Income elastic If the price elasticty of demand for a good is -2.5 and the firm cuts the price of this good by 5%, what change would we expect to see in the demand for this product? 6. a) Increase of 2% b) Increase of 12,5% c) Increase of 0,5% d) Increase of 10%
Managerial Economics: Applications, Strategies and Tactics (MindTap Course List)
14th Edition
ISBN:9781305506381
Author:James R. McGuigan, R. Charles Moyer, Frederick H.deB. Harris
Publisher:James R. McGuigan, R. Charles Moyer, Frederick H.deB. Harris
Chapter3: Demand Analysis
Section: Chapter Questions
Problem 7E: In an attempt to increase revenues and profits, a firm is considering a 4 percent increase in price...
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Transcribed Image Text:If the disposable income increases by 5% and the income elasticity of demand is 0,5,
what change in demand would we expect to see?
4.
а) 10%
b) 5%
c) -5%
d) 2,5%
If a decrease in price does not lead to an increase in revenue, we might conclude that
the demand for this product is?
5.
a) Price inelastic
b) Income inelastic
c) Price elastic
d) Income elastic
If the price elasticty of demand for a good is -2.5 and the firm cuts the price of this
good by 5%, what change would we expect to see in the demand for this product?
6.
a) Increase of 2%
b) Increase of 12,5%
c) Increase of 0,5% d) Increase of 10%
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