Microeconomics
21st Edition
ISBN: 9781259915727
Author: Campbell R. McConnell, Stanley L. Brue, Sean Masaki Flynn Dr.
Publisher: McGraw-Hill Education
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Chapter 6, Problem 1P
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For product X, the price elasticity of demand has an
absolute value of 3.5. This means that quantity
demanded will increase by
O 1 unit for each $3.50 decrease in price, ceteris paribus.
O 1 percent for each 3.5 percent decrease in price,
ceteris paribus.
O 3.5 units for each $1 decrease in price, ceteris paribus.
O 3.5 percent for each 1 percent decrease in price,
ceteris paribus.
If an increase in price from $1 to $2 causes a decrease in quantity demanded from 120 to 100, calculate the price elasticity of demand by using
the midpoint method.
O 1.2
O 1.3
O 0.27
O 0.5
For a certain good, when the good's price falls from $12 to $10, its
quantity demanded rises from 10 to 12 units. The price elasticity of
demand here is
O 2.55.
0.66.
O 0.39.
O 0.20.
1.00
Chapter 6 Solutions
Microeconomics
Ch. 6 - Explain why the choice between 1, 2, 3, 4, 5, 6,...Ch. 6 - Prob. 2DQCh. 6 - The income elasticities of demand for movies,...Ch. 6 - Research has found that an increase in the price...Ch. 6 - Prob. 5DQCh. 6 - Suppose that the total revenue received by a...Ch. 6 - Suppose that the total revenue received by a...Ch. 6 - Calculate total-revenue data from the demand...Ch. 6 - Prob. 4RQCh. 6 - 5. In 2006, Willem de Kooning’s abstract painting...
Ch. 6 - Suppose the cross elasticity of demand for...Ch. 6 - Look at the demand curve in Figure 6.2a. Use the...Ch. 6 - Prob. 2PCh. 6 - Graph the accompanying demand data, and then use...Ch. 6 - Danny Dimes Donahue is a neighborhoods 9-year-old...Ch. 6 - What is the formula for measuring the price...Ch. 6 - ADVANCED ANALYSIS Currently, at a price of 1 each,...Ch. 6 - Prob. 7P
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- If the price of Moonlight massage oil decreases from $3 to $2.50 and, as a result, total revenue increases from $6,000 to $7,500, what is the elasticity of demand. O 22. O 1.22. O 0.55. O 1.67. O 0.22.arrow_forwardSuppose that the elasticity of supply is 1.60 and the price increases by 5%. We will predict a percent increase in the quantity supplied of: 8% 6% O 3.1% 12%arrow_forwardSuppose the demand for a Nintendo console is P = 600 - 0.05Q, where P represents the price of a console (in dollars) and Q is the number of Nintendo consoles sold in a certain market. If the price of each console is $300, what is the price elasticity of demand for Nintendo consoles in that market? O -0.0025 O -0.05 O-1 O-1.5 0-2arrow_forward
- You are the manager of a firm that receives revenues of $60,000 per year from product X and $80,000 per year from product Y. The own price elasticity of demand for product X is -1.5, and the cross- price elasticity of demand between product Yand X is -1.4. How much will your firm's total revenues (revenues from both products) change if you increase the price of good X by 2 percent? Instructions: Enter your response rounded to the nearest dollar. Use a negative sign (-) if applicable. %24arrow_forwardAssume that a decrease of 10 percent in the price of cars results in an increase of 30 percent in quantity demanded, then the price elasticity of demand is 3 O 0.5 O 1 O 0.333arrow_forwardWhen a ride-sharing service implements "surge" pricing, raising all fares by 30%, drivers choose to work longer hours and and the supply this results in an increase of 40% more rides available. The price elasticity of supply for ride-sharing is is O 1.33; inelastic O 1.33; elastic O 0.75; elastic O 0.75; inelasticarrow_forward
- For U.S. consumers, the income elasticity of demand for fruit juice is 1.1. If the economy enters a recession next year and consumer income declines by 2.5%, what is the expected change in the quantity of fruit juice demanded next year? O A) +2.75% O B) -2.75% O C) +27.5% O D) -27.5%arrow_forwardAfter paying an economist to estimate the price elasticity of demand for socks, sock manufacturers, expecting to increase revenues, decide to increase the price of socks. The estimate of demand elasticity could have been: а. 1.75 O b. 0.25 с. 1.5 O d. 2arrow_forwardYou are the manager of a firm that receives revenues of $20,000 per year from product X and $90,000 per year from product Y. The own price elasticity of demand for product X is -3, and the cross-price elasticity of demand between product Yand X is -1.3. 1 percent? How much will your firm's total revenues (revenues from both products) change if you increase the price of good X by Instructions: Enter your response rounded to the nearest dollar. If you are entering a negative number, be sure to use a (-) sign.arrow_forward
- Pop's Corn Popcorn shop normally sells 100 bags a day when the price is $6 per bag. On half-price Wednesday, the price is $3 and Pop's sells 150 bags. What is the price elasticity of demand? O 16.67 O 1.667 O 0.6 O 0.5 O 2arrow_forwardThe store selling maize meal makes a further discovery, when the price of rice changes from R30 per kg to R26 per kg, then the quantity of maize demanded decrease from 1360 kg per month to 1238 kg per month. Use this information to answer Q3.2.1 and Q3.2.2 below. Q3.2.1 Use the point method to calculate the cross elasticity of demand for these products. (Formula + calculation) Q3.2.2 Comment on the significance of your solution in Q3.2.1 Q3.3 Identify three factors that are likley to affect the price elasticity of supply for rice. Clearly indiacte the impact that each factor will have on the price elasticity.arrow_forwardSuppose the price elasticity of demand for the market of mobile phones is 0.90. If all mobile-phone companies simultaneously increased their prices, will total revenue in the industry increase or decrease? If a single mobile-phone company increased its price, would you expect the company’s total revenue to increase or decrease? Explain. Suppose that the price in the market is initially $10 and the quantity demanded is 100 units. If the price in this market increases by 10%, what will be the percentage change in the quantity demanded? Give me long detalied answer pleasearrow_forward
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