question archive If a 2% increase in the price of a good causes sales to decrease by 1%, the "own price elasticity of demand" for this product is: a) 1/2 b) -1/2 c) 2 d) -2 e) 1 Cross price elasticity of demand for automobiles and apples is likely to be a) negative, since the goods are complements b) negative, since the goods are substitutes
If a 2% increase in the price of a good causes sales to decrease by 1%, the "own price elasticity of demand" for this product is: a) 1/2 b) -1/2 c) 2 d) -2 e) 1 Cross price elasticity of demand for automobiles and apples is likely to be a) negative, since the goods are complements b) negative, since the goods are substitutes
Subject:EconomicsPrice: Bought3
If a 2% increase in the price of a good causes sales to decrease by
1%, the "own price elasticity of demand" for this product is:
a) 1/2
b) -1/2
c) 2
d) -2
e) 1
Cross price elasticity of demand for automobiles and apples is likely to be
a) negative, since the goods are complements
b) negative, since the goods are substitutes.
c) positive, since the goods are complements.
d) positive, since the goods are substitutes.
e) equal to zero, since the goods are not related.
Assuming the demand for illegal drugs is inelastic in the relevant range of prices and the supply of illegal drugs is relatively elastic, what will be the impact of a government drug policy that is aimed at curtailing the flow of drugs into the country?
a) the quantity of drugs consumed will not change very much while the price will increase significantly, and the policy will be, to a large extent, self-defeating, as the increase in price will increase the suppliers' financial resources.
b) the quantity of drugs consumed will be significantly reduced.
c) the price of drugs will not be affected very much.
d) none of the above.
