Principles of Economics (MindTap Course List)
8th Edition
ISBN: 9781305585126
Author: N. Gregory Mankiw
Publisher: Cengage Learning
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Textbook Question
Chapter 5, Problem 5CQQ
An increase in the supply of a good will decrease the total revenue producers receive if
a. the demand curve is inelastic.
b. the demand curve is elastic.
c. the supply curve is inelastic.
d. the supply curve is elastic.
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If the price elasticity of supply for a good is 0.48, then this means that
A. the supply is inelastic and therefore the demand must also be inelastic.
B. a 10 percent increase in price results in a 4.8 percentage increase in quantity supplied.
C. a 10 percent price increase results in a 4.8 percentage decrease in quantity supplied.
D. the supply is elastic.
E. the percentage increase in quantity supplied is greater than the percentage increase in price.
Moving down a linear demand curve, what happens to the slope and the elasticity?
A. The slope is constant but elasticity gets smaller.
B. The slope changes but elasticity is constant.
C. The slope and elasticity both get smaller.
D. The slope and elasticity are both constant.
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Chapter 5 Solutions
Principles of Economics (MindTap Course List)
Ch. 5.1 - Define the price elasticity of demand. Explain...Ch. 5.2 - Define the price elasticity of supply. Explain...Ch. 5.3 - Prob. 3QQCh. 5 - A life-saving medicine without any close...Ch. 5 - The price of a good rises from 8 to 12, and the...Ch. 5 - A linear, downward-sloping demand curve is a....Ch. 5 - Prob. 4CQQCh. 5 - An increase in the supply of a good will decrease...Ch. 5 - Over time, technological advance increases...Ch. 5 - Prob. 1QR
Ch. 5 - List and explain the four determinants of the...Ch. 5 - Prob. 3QRCh. 5 - Prob. 4QRCh. 5 - If demand is elastic, how will an increase in...Ch. 5 - What do we call a good with an income elasticity...Ch. 5 - How is the price elasticity of supply calculated?...Ch. 5 - If a fixed quantity of a good is available, and no...Ch. 5 - Prob. 9QRCh. 5 - Prob. 1PACh. 5 - Prob. 2PACh. 5 - Suppose the price elasticity of demand for heating...Ch. 5 - A price change causes the quantity demanded of a...Ch. 5 - Prob. 5PACh. 5 - The price of coffee rose sharply last month, while...Ch. 5 - Suppose that your demand schedule for pizza is as...Ch. 5 - The New York Times reported (Feb. 17, 1996) that...Ch. 5 - Prob. 9PACh. 5 - Prob. 10PACh. 5 - You are the curator of a museum. The museum is...Ch. 5 - Prob. 12PA
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- If the elasticity of demand for hamburgers equals 21.5 and the quantity demanded equals 40,000, predict what will happen to the quantity demanded of hamburgers when the price increases by 10 percent. If the price falls by 5 percent, what will happen?arrow_forwardJills Sausage Dog Stand projects the following demand for Jills sausage dogs: a. Calculate the price elasticity of demand between 2 and 4. Is demand in this range elastic or inelastic? b. Calculate the price elasticity of demand between 4 and 6. Is demand in this range elastic or inelastic?arrow_forwardIf the price of a good or service increases and the total revenue received by the seller declines, is the demand for this good over this segment of the demand curve elastic or inelastic? Explain.arrow_forward
- Suppose a movie theater raises the price of popcorn 10 percent, but customers do not buy any less popcorn. What does this tell you about the price elasticity of demand? What will happen to total revenue as a result of the price increase?arrow_forwardThe quantity demanded of good X rises from 130 to 145units as income rises from 2,000 to 2,500 a month. What is the income elasticity of demand for good X?arrow_forwardSuppose a university raises its tuition from 3,000 to 3,500. As a result, student enrollment falls from 5,000 to 4,500. Calculate the price elasticity of demand. Is demand elastic, unitary elastic, or inelastic?arrow_forward
- The price elasticity of the demand for gasoline is -0.02. The price elasticity of demand for gasoline at Joe’s 66 station is -1.2. Explain what might account for the different elasticities.arrow_forwardA college raises its annual tuition from 23,000 to 24,000, and its student enrollment falls from 4,877 to 4,705. Compute the price elasticity of demand. Is demand for the college elastic or inelastic?arrow_forwardThe slope of a linear demand curve is constant, but the elasticity is not. At points with a low price and a high quantity demanded, demand is elastic. At points with a high price and a low quantity demanded, demand is inelastic. a. False b. Truearrow_forward
- In the demand curve, there is a mid-point. Determine the value of: i. Elasticity of demand in the mid-point ii. Elasticity of demand above the mid-point iii. Elasticity of demand below the mid-pointarrow_forwarde. Assume the price decreases from $20 to $12. i. Calculate the price elasticity of demand. Show your work. ii. In this price range, is demand perfectly elastic, relatively elastic, unit elastic, relatively inelastic, or perfectly inelastic? Pricearrow_forwardIf an increase in the supply of good A increases the demand for good B, then A. A and B are substitutes. B. the elasticity of supply for good A is greater than 1. C. A and B are complements. D. the demand for A is price elastic. E. the cross elasticity of supply for good B with respect to the price of good A is positive.arrow_forward
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Price Elasticity of Supply; Author: Economics Online;https://www.youtube.com/watch?v=4bDIm3j-7is;License: Standard youtube license