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
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
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 demand will be _____ if there is no change in the demand of the commodity inspite of the change in the price of the commodity.
The price elasticity of demand is defined as the absolute value of the ratio of
Price over quantity demanded.
Change in price over change in quantity demanded.
Percentage change in price over the percentage change in quantity demanded.
Percentage change in quantity demanded over the percentage change in price.
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.
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
Inferior
