QUESTION 1 A linear demand for lake front cabins on a nearby lake is estimated to be: QD = 900,000 - 2P

Subject:EconomicsPrice:2.88 Bought3

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QUESTION 1

A linear demand for lake front cabins on a nearby lake is estimated to be: QD = 900,000 - 2P. What is the point price elasticity for lake front cabins at a price of P = $300,000?

A. EP = -3.0

B. EP = -2.0

C. EP = -1.0

D. EP = -0.5

QUESTION 2

Marginal revenue (MR) is when total revenue is maximized.

A. greater than one

B. equal to one

C. less than zero

D. equal to zero

QUESTION 3

Which of the following would tend to make demand INELASTIC?

A. the amount of time analyzed is quite long.

B. there are lots of substitutes available

C. the product is highly durable

D. the proportion of the budget spent on the item is very small

QUESTION 4

An income elasticity (Ey) of 2.0 indicates that for a_ increase in income, will increase by .

A. one percent; quantity supplied; two units

B. one unit; quantity supplied; two units

C. one percent; quantity demanded; two percent

D. one unit; quantity demanded; two units