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
If change in the demand of the commodity is proportionate to change in price, the demand of the commodity will be
Unit elasticity
Less than unit elasticity
Perfectly elastic
Perfectly inelastic
A vertical demand curve has
Infinite elasticity
Zero elasticity
Varying elasticity
For which product is the income elasticity of demand most likely to be negative?
Computer software
Used clothing
Basket balls
Bread
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
Inelastic
Elastic
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
In figure, a unit elastic demand curve is shown by
a
b
c
d
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
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
