When is demand inelastic?
The percentage change of quantity demanded is greater than the percentage change in price of a good.
The percentage change of quantity demanded is smaller than the percentage change in price of a good.
A relative small change in price results in a relatively big change in quantity demanded.
The PED is greater than 1.
The factors that change PES are?
Time only.
Time and stocks only.
Stocks and capacities only.
Time, stocks, capacities, and capital labor.
What should a company do to raise total revenue if the product is inelastic?
Lower prices.
Declare it an inferior good.
Diversify its production.
Raise prices.
The price of elasticity of demand of an elastic product can range between?
-1 to 1
0 to 1
-infinity to 1
1 to infinity
When is the Xed a substitute good rather than a complementary one?
When the Xed is negative
When it is a normal good
When the Xed is positive
Can't be determined
Supply is elastic if?
The good in the question is a normal good
The slope of the supply curve is positive
If the curve crosses through y-axis
If the curve crosses through x-axis
If the price elasticity of demand for a product equals 1, as its price rises the
Total revenue increases
Total revenue stays the same
Total revenue decreases
supply of good decreases
What is the difference between a luxury good and an inferior good.
Luxury goods Yed is always positive, and elastic
Luxury goods Yed is always positive, and inelastic
Luxury goods Yed may be both inelastic and elastic
Luxury goods are always negative
In substitute goods...?
Weak substitutes are elastic
There is no such a thing as weak substitutes
Strong substitutes are elastic
There is no such a thing as strong substitutes
What is the shape of the unit elastic for PED?
Horizontal
Vertical
Positively diagonal
Rectangular hyperbola
