Price Elasticity - Demand Curve

If consumers have budgeted a fixed amount of money to buy a certain commodity, and within a certain range of prices will spend neither more nor less than this amount on it, then their demand curve in this price range would be properly designated as: A) in equilibrium. B) perfectly price elastic. C) perfectly price inelastic. D) highly price inelastic but not perfectly so. E) unitary price elastic.

Demand Curve Properties

36. A straight-line demand curve has which of the following properties? A) Constant slope and varying price elasticity. B) Constant income elasticity with varying slope. C) Varying slope and varying supply elasticity. D) Constant slope and constant price elasticity. E) None of the above may be asserted in general.

Equilibrium

During the first year that the Salk vaccine for infantile paralysis became available, the quantity produced was too small to inoculate all those in susceptible age groups. Although the cost of production and the price were not particularly high, production could not be expanded rapidly enough to meet the demand. The government therefore intervened to regulate its distribution. What do these facts suggest about the price of Salk vaccine during the first year it was available? It was: A) at equilibrium and government should not have intervened. B) above equilibrium and a price ceiling was required. C) below equilibrium and a price ceiling was required. D) indeterminate. E) b... click for more

Supply and Demand, Price

For a given increase in supply, price will fall most when demand is relatively A) inelastic and supply is relatively inelastic. B) inelastic and supply is relatively elastic. C) elastic and supply is relatively inelastic. D) elastic and supply is relatively elastic. E) any of the above.

Demand Curve - Elasticity

Suppose that successive price reductions reduce total revenue. The supplier faces a demand curve that is, in this region: A) price elastic. B) unitary elastic. C) infinitely price elastic. D) of indeterminate elasticity. E) price inelastic.