Elasticities in Microeconomics MCQs
Elasticities in Microeconomics MCQs
Our experts have gathered these Elasticities in Microeconomics MCQs through research, and we hope that you will be able to see how much knowledge base you have for the subject of Elasticities in Microeconomics by answering these 20 multiple-choice questions.
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1: Cross-price elasticity of demand is the measure of the impact that the price change of one good will have on the demand of another good
A. True
B. False
2: Elastic can be described as
A. ED > 1
B. ED < 1
C. ED <= 1
D. ED >= 1
3: The percentage change in demand divided by the percentage change in consumers’ income is called
A. Price elasticity of demand
B. Price elasticity of Supply
C. Income elasticity of demand
D. Income elasticity of Supply
4: Inelastic can describe as
A. ED > 1
B. ED < 1
C. ED <= 1
D. ED >= 1
5: The measure of the responsiveness of quantity demanded to a change in price is known as
A. Price elasticity of demand
B. Price elasticity of Supply
C. Income elasticity of demand
D. Income elasticity of Supply
6: The measure of the sensitivity of the quantity supplied to changes in the price of a good is called
A. Price elasticity of demand
B. Price elasticity of Supply
C. Income elasticity of demand
D. Income elasticity of Supply
7: Total revenue is Amount _______ receive for a good or service.
A. Buyer
B. Producer
C. Sellers
D. Suppliers
8: Unit elastic demand is the Demand with a ____ elasticity of 1
A. Product
B. Price
C. Sale
D. Purchase
9: Which of the following is an accurate statement about elasticity?
A. A steep demand curve shows elastic demand.
B. A steep demand curve shows inelastic demand.
C. A horizontal demand curve has perfectly inelastic demand.
D. A vertical demand curve has somewhat inelastic demand.
10: Which of the following will tend to have elastic demand?
A. Goods with close substitutes
B. Goods without complements
C. Goods with a small proportion of income spent on them
D. Goods with a short amount time for people to adapt to their price change
11: The price elasticity of demand can be defined as the percentage change in quantity demanded ______ the percentage change in price.
A. Plus
B. Minus
C. Multiplied by
D. Divided by
12: If demand is ______ to changes in price, it is considered to be perfectly inelastic.
A. Slightly responsive
B. Unresponsive
C. Extremely responsive
D. Mostly unresponsive
13: The equation ED = 1 shows ______ demand.
A. Unit elastic
B. Elastic
C. Perfectly inelastic
D. Inelastic
14: The equation ED = 1 shows ______ demand.
A. Unit elastic
B. Elastic
C. Perfectly inelastic
D. Inelastic
15: A long-run elasticity of demand means that a consumer has ______.
A. Many substitutes to choose from
B. Few substitutes to choose from
C. A lot of time to adjust to a price change
D. Little time to adjust to a price change
16: When the price elasticity of demand is ______, total revenues will fall as the price declines.
A. Unit elastic
B. Perfectly elastic
C. Inelastic
D. Elastic
17: Which of the following price ranges of a linear demand curve will tend to be the most elastic?
A. Very high price range
B. Moderately high price range
C. Moderately low price range
D. Very low price range
18: In the elastic region of a demand curve, when price falls, the total revenue ______, and when price rises, the total revenue ______.
A. Rises; remains constant
B. Remains constant; falls
C. Falls; rises
D. Rises; falls
19: Which of the following accurately shows cross-price elasticity of demand?
A. The desire for one good is affected by the quantity of a related good.
B. The desire for one good is affected by the cost of a related good.
C. The quantity for one good is affected by the desire for a related good.
D. The quantity for one good is affected by the cost of a related good.
20: If the price of one good and the demand for the other good move in the same direction, then the cross-price elasticity is ______.
A. Negative
B. Positive
C. Neutral
D. Indeterminate
21: In a condition of perfectly elastic supply, the elasticity of supply is ______.
A. Zero
B. 100
C. 1,000,000
D. Infinite
22: Which of the following is an accurate statement about supply?
A. It rarely has an elasticity less than 1.
B. It uses price elasticity, but not price inelasticity.
C. It has infinite elasticity when the supply is perfectly inelastic.
D. It is more inelastic in the short run.
23: The burden of the tax is more likely to fall on the party that has ______.
A. Less revenue
B. More revenue
C. Fewer good alternatives
D. More good alternatives
24: What was the amount of the luxury tax levied by Congress in 1991?
A. 5%
B. 10%
C. 15%
D. 20%
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Elasticities in Microeconomics MCQs
