If the demand of the commodity changes at faster rates than change in the price of the commodity, the demand of the commodity will be known as
Perfectly elastic
Inelastic
Perfectly inelastic
Elastic
Change in the demand of a commodity due to change in the price of the substitute is an example of
Cross elasticity
Price elasticity
Income elasticity
The demand will be _____ if there is no change in the demand of the commodity inspite of the change in the price of the commodity.
Demand will be more elastic
The higher the income
The lower the price
The shorter the passage of time after a permanent price increase
The more substitutes available for the good.
If a good is a luxury, its income elasticity of demand is.
Positive and less than 1
Negative but greater than 1
Positive and greater than 1
Zero
A infinite news paper publisher decides to cut price in order to raise circulation and revenue. This policy is more likely to be successful when demand for the newspaper is which one of the following?
Relatively inelastic
Unit elastic
Relatively elastic
A state government wants to increase the taxes on cigarettes to increase tax revenue. This tax would only be effective in raising new tax revenues if the price elasticity of demand is
Unity
Cross elasticity of demand is
Negative for complementary goods
Negative for substitute goods
Unitary for inferior goods
Positive for inferior goods.
The price elasticity of demand generally tends to be:
Smaller in the long tun than in the shot run
Smaller in the short run than in the long run
Un related to the length of time
Larger in the short run than in the long run.
If the price elasticity of demand for a good is. 75, the demand for the good can be described as:
Normal
Inferior
