EPF 3.3 Review

What does Price Elasticity of Demand (PED) measure?

• The change in supply due to a change in price

• How sensitive quantity demanded is to a change in price

• The total revenue generated from sales

• The cost of production for a product

How would a doubling in the price of medicine affect its quantity demanded?

• Quantity demanded will significantly decrease

• Quantity demanded will slightly decrease

• Quantity demanded will remain the same

• Quantity demanded will significantly increase

What is the likely effect on the quantity demanded of luxury yachts if their prices double?

• Quantity demanded will significantly increase

• Quantity demanded will slightly increase

• Quantity demanded will significantly decrease

• Quantity demanded will remain the same

If the price of milk doubles, what is the expected impact on its quantity demanded?

• Quantity demanded will significantly increase

• Quantity demanded will slightly decrease

• Quantity demanded will significantly decrease

• Quantity demanded will slightly decrease

What does the term "inelastic demand" refer to in economics?

• Demand that changes significantly with price changes

• Demand that remains constant regardless of price changes

• Demand that decreases as price increases

• Demand that increases as price decreases

If the price of a product with inelastic demand increases, what happens to the quantity demanded?

• It falls significantly.

• It increases significantly.

• It falls a little.

• It increases a little.

Which of the following is an example of a product with inelastic demand?

• Luxury cars

• Designer clothing

• Milk

• Electronics

What does the concept of "elastic demand" refer to in economics?

• Demand that does not change with price

• Demand that increases as price increases

• Demand that decreases as price decreases

• Demand that changes significantly with price changes

In the context of the cartoon, what happens to the demand for cola when the price increases from $1.00 to $3.00?

• Demand increases

• Demand remains the same

• Demand decreases

• Demand becomes inelastic

Which of the following is an example of a product with elastic demand?

• Soda

• Electricity

• Water

• Medicine