Managerial Economics: A Problem Solving Approach
5th Edition
ISBN: 9781337106665
Author: Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike Shor
Publisher: Cengage Learning
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Chapter 12, Problem 6MC
To determine
Acquiring substitute good.
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The rate of changes in demand due to the changes in the determinants of demand is known as __________.
a.
Elasticity of demand
b.
Law of demand
c.
Quantity demanded
d.
Effective demand
If the price of home computers rises and people still buy more of them, then
a. the law of demand does not hold.
b. this could have been caused by a change in the none price determinants of demand.
c. demand has decreased.
d. the demand for home computers is elastic.
e. the demand for home computers is inelastic.
Suppose we observe that when the market price of a good rises dramatically (e.g., the price of houses during the pandemic) the quantity traded increases only slightly,
This would be because
Answers A - D
A.supply has increased and demand is very elastic.
B.supply has decreased and demand is very elastic.
C.supply has increased and demand is very inelastic.
D. demand has increased and supply is very inelastic.
Chapter 12 Solutions
Managerial Economics: A Problem Solving Approach
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Similar questions
- This means that when the price of a certain commodity increases, automatically demand will fall and vice versa, all other things held constant. Select one: a. Law of demand b. demand c. quantity demanded d. elasticity of demandarrow_forwardThe equilibrium price will be determined entirely by the demand when a.demand is perfectly inelastic. b.demand is downward sloping. c.supply is perfectly elastic. d.supply is perfectly inelastic.arrow_forwardDemand is ________ when a change in price leads to a relatively larger change in the quantity demanded. On the other hand, demand is __________ when a change in price leads to a relatively smaller change in the quantity demanded. Select one: a. Decreasing; increasing b. Increasing; decreasing c. Elastic; inelastic d. Inelastic; elasticarrow_forward
- Demand for the desired quantity of a good that is backed by the ability to buy that good is known as: A. Effective Demand B. Derived Demandarrow_forwardAn increase in demand will have a ____ effect on price and a ____ effect on output when supply is relatively elastic.a. larger; smallerb. larger; largerc. smaller; largerd. smaller; smallerarrow_forwardAn increase in the supply of grain will reduce thetotal revenue grain producers receive ifa. the supply curve is inelastic.b. the supply curve is elastic.c. the demand curve is inelastic.d. the demand curve is elastic.arrow_forward
- iii. A demand curve which is parallel to the vertical axis is: A. perfectly inelastic. B. perfectly elastic. C. relatively inelastic. D. relatively elastic.arrow_forwardThe demand of Pepsi increases as the price of Cola increases and vice versa. Determine, what type of demand is there between Pepsi and Cola? a. Cross demand b. Composite demand c. Derived demand d. Income demandarrow_forward1. An example of a market where supply and demand are both inelastic. 2. An example of a market where both supply and demand are both elastic. 3. An example of a market where supply is inelastic and demand is elastic. 4. An example of a market where supply is elastic and deman is inelastic.arrow_forward
- . ______________ is the willingness to buy a product and the ability to pay for it. Select one: a.Demand b.Quantity c.The Law of Demand d.Elasticityarrow_forwardWhat is the concept of perfectly inelastic demand in economics? A. A situation where quantity demanded remains unchanged regardless of price changes B. A situation where price elasticity of demand is equal to zero C. A situation where price and quantity demanded move in opposite directions D. A situation where consumers are indifferent to changes in pricearrow_forwardWhich of the following causes for an increase in the supply of a product? a. An increase in the rate of tax b. An increase in the cost of production c. An increase in subsidy d. A decrease in the number of sellersarrow_forward
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