question archive True or False : - When supply is perfectly inelastic, a change in demand has no effect on the price - The short-run elasticity of supply is larger than the long-run elasticity of supply because changes in equilibrium will adjust elasticity accordingly - When the price increases, total revenue always inceases because of the price effect: producers receive a higher price for the good - A swiffer floor sweeper and a broom would have a positive cross-price elasticity of demand - A key consideration as to whether the pruce elasticity of supply is elastic or inelastic is whether the good supplied is a luxury item
True or False : - When supply is perfectly inelastic, a change in demand has no effect on the price - The short-run elasticity of supply is larger than the long-run elasticity of supply because changes in equilibrium will adjust elasticity accordingly - When the price increases, total revenue always inceases because of the price effect: producers receive a higher price for the good - A swiffer floor sweeper and a broom would have a positive cross-price elasticity of demand - A key consideration as to whether the pruce elasticity of supply is elastic or inelastic is whether the good supplied is a luxury item
Subject:EconomicsPrice:2.88 Bought3
True or False :
- When supply is perfectly inelastic, a change in demand has no effect on the price
- The short-run elasticity of supply is larger than the long-run elasticity of supply because changes in equilibrium will adjust elasticity accordingly
- When the price increases, total revenue always inceases because of the price effect: producers receive a higher price for the good
- A swiffer floor sweeper and a broom would have a positive cross-price elasticity of demand
- A key consideration as to whether the pruce elasticity of supply is elastic or inelastic is whether the good supplied is a luxury item
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When supply is perfectly inelastic, a change in demand has no effect on the price. False. The price changes because when products have perfectly inelastic supply, the number supplied is identical, despite the price.
The short-run elasticity of supply is larger than the long-run elasticity of supply because changes in equilibrium will adjust elasticity accordingly. False. Elasticity is usually lower in the short run than in the long run.
When the price increases, total revenue always increases because of the price effect: producers receive a higher price for the good. False. This not always true; the price can increase without being translated in higher total revenue if costs also increase.
A swiffer floor sweeper and a broom would have a positive cross-price elasticity of demand. True. Cross-price elasticity of demand estimates the responsiveness of a product's quantity demanded when the price for a similar product increases.
A key consideration as to whether the price elasticity of supply is elastic or inelastic is whether the good supplied is a luxury item. False. Price elasticity of supply is the responsiveness of quantity supplied when there is a change in the price of the product. If the supply is elastic, the manufacturer raises its output without an increase in cost. This does not only apply to luxury products.
