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ECON102 Study Guide - Quiz Guide: Photocopier

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coralhyena595
3 Mar 2015
School
University of Waterloo
Department
Economics
Course
ECON102
Professor
Wokia Kumase

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ECON102 Full Course Notes
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ECON102 Full Course Notes
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Document Summary

If a 4 percent rise in the price of good x causes tr to fall by 8 percent, demand for good x is: A technological breakthrough lowers the cost of photocopiers. If the demand for photocopiers is price inelastic, we predict that photocopier sales will. Rise but changes in tr would depend on elasticity of supply. If jets decrease ticket prices and find that tr does not change, price elasticity of demand is zero. None of the above if the price elasticity of demand is 2, a 1 percent decrease in price will. The demand for a good is price inelastic if. Suppose a 8 percent rise in bison meat reduces the consumption of bison meat by 24 percent, it indicates that. Bison meat is price inelastic and tr would rise. Bison meat is unit elastic and tr would be unchanged. Bison meat is price elastic and tr would fall.

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Related Questions

23. A technological breakthrough lowers the cost of photocopiers. If the demand for photocopiers is price elastic, photocopier sales will A) fall and total revenue will rise. B) fall and total revenue will fall. C) rise and total revenue will rise. rise and total revenue will fall. E) rise, but changes in total revenue will depend on elasticity of supply

38) A technological breakthrough lowers the cost of photocopiers. If the demand for photocopiers is price inelastic, we predict that photocopier sales will A) rise and total revenue will decrease. B) fall and total revenue will increase. C) rise and total revenue will increase. D) fall and total revenue will decrease. E) rise, but changes in total revenue will depend on elasticity of supply.

From the scenario for Katrina’s Candies, examine the procedure Herb will use to estimate the "demand model" for this product and comment on the expected price elasticity, income elasticity, and cross price elasticity of demand. That is, do you expect demand to be price elastic or inelastic? Will the income elasticity suggest Katrina Candies is a luxury or a necessary good? And, is there likely to be a strong cross price elasticity with the other products that Herb included in his demand model? Explain your answers. What can you determine about consumer demand for a product whose estimated demand elasticities are as follows: Price Elasticity of demand is -0.85 Income Elasticity of demand is 2.5 Cross Price Elasticity of demand with this product and your product is -2 I would like you to think about this simple formula for predicting the change in total revenue when there is a given percentage change in price. Using the example above, if ED (price elasticity of demand) is -.85, then a 10% increase in price will cause the quantity demanded to fall by 8.5%, (-8.5% / 10% = -.85). The Formula for Predicting % Changes in Total Revenue is: %ΔTR = %ΔQ + %ΔP where TR = Total Revenue, Q is Quantity Demanded and P = price. Using this formula, what would be the % Δ in TR if ED is -.85 and the %ΔP is 10%?