AY22_Sem1_B220_L04

The price elasticity of demand measures _______________________________.

• how sensitive quantity demanded is to changes in production

• the responsiveness of quantity demanded to change in price

• the slope of a budget curve

• how often the price of a good changes

The formula for calculating elasticity of demand is

• the % change in quantity demanded over the % change in price

• the % change in price over the % change in quantity demanded

• the change in price over the change in quantity demanded

• the change on quantity demanded over the change in price

The Price Elasticity of Demand for Bread is 0.5, therefore we can say that the demand for Bread is __________.

• elastic

• inelastic

• unit elastic

• perfectly inelastic

Which of the following is a factor affecting Price Elasticity of supply?

• Degree of Necessity

• Consumer Habit

• Broadness of Category

• Spare Production Capacity

Figure 1 shows the supply curve of a Sunglasses producer. When the price of sunglasses increased to $110, the quantity supplied is 200. Therefore, we can say that the supply of sunglasses is ______________.

• perfectly elastic

• unitary elastic

• elastic

• inelastic