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
Perfectly inelastic
Unit elastic
Relatively elastic
Cross elasticity of demand is
Negative for complementary goods
Negative for substitute goods
Unitary for inferior goods
Positive for inferior goods.
If demand is price elastic, then:
A rise in price will raise total revenue
A fall in price will raise total revenue
A fall in price will lower the quantity demanded.
A rise in price won't have any effect on total revenues.
A vertical demand curve has
Unit elasticity
Infinite elasticity
Zero elasticity
Varying elasticity
If the price elasticity of demand for a good is. 75, the demand for the good can be described as:
Normal
Elastic
Inferior
Inelastic
Under which one of the following circumstances will the firm have to absorb all the increase in indirect tax itself, being unable to pass on any of it to the consumer?
Perfectly inelastic demand
Perfectly elastic demand
Unit elastic demand
Relatively elastic demand
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
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
Perfectly elastic
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.
Revenues from the sale of a good will decrease if
Income increases and the good is normal
The price rises and demand is elastic
The price rises and demand is inelastic
Income falls and the good is interior