Demand and supply test

Your demand for a good is in elastic if you consider the good to be

• Essential

• normal

• Replaceable

• Inferior

In July, an automobile company announces that next year’s models with more features will start to arrive in Sep or Oct. what is most likely to happen to demand for this year’s model in Aug?

• Demand will fall in anticipation

• Demand will rise

• Demand will go to zero

• Demand will stay the same

If the elasticity of demand for a good at a certain price is less than one, then the demand is

• Inelastic

• Elastic

• Unitary elastic

• Negative elastic

Businesses multiply the price they charge for a good by the quantity sold to calculate

• marker demand

• Profit shares

• Elastic demand

• Total revenue

Businesses often use information such as age, income level, and occupation to sell products to certain groups of people. What is this type of information called?

• revenues

• Demographics

• Complements

• Markets

John gets a raise and decides to buy fancy pasta instead of cheaper instant noodle. Which phrase describes what instant noodles are for John?

• unitary elastic

• Complements

• Market demand

• Inferior goods

Which of these products or services is likely to have an inelastic supply in the short run?

• cargo ships

• Haircuts

• Newspapers

• Staples

If marginal cost becomes higher than price, what happens to a company?

• the company will lose money on each additional unit produced

• The company will go out of business

• Company specialization will lower

• Diminishing marginal returns will shrink production

What effect do rising input costs have on the price of a good?

• the good becomes cheaper to produce

• It has no effect on the cost of the good

• The good becomes more expensive to produce

• The good becomes dependent on government regulation

What’s one reason European governments protect the growing of food with subsidies?

• To have food in case imports are ever restricted

• To reduce the price of farm grown food

• The help the population forget the food shortages after WW2

• To allow the food producers to pay their debts