Question 1

Exhibit 19-2 -Refer to Exhibit 19-2. The market for good X is initially in equilibrium at $5. The government then places a per-unit tax on good X, as shown by the shift of S₁ to S₂. As a result, the equilibrium price

Accepted Answer

A per-unit tax on a good typically causes the supply curve to shift upwards or to the left, leading to an increase in the equilibrium price as the market adjusts to the new cost of production.

Question 2

Suppose a producer decides that if the price of her product is $42, the quantity supplied will be 1,000 units, and if the price is $45, the quantity supplied will be 1,300. The price elasticity of supply for the good is approximately

Accepted Answer

The answer of Suppose a producer decides that if the...

Question 3

If for good Z income elasticity is greater than 1, then demand for good Z is income __________, and good Z is a(n) __________ good.

Accepted Answer

When the income elasticity of demand for a good is greater than 1, it means that demand for the good increases by a higher percentage than the increase in income, indicating that the good is a luxury or a normal good with elastic demand relative to income changes.

Question 4

Exhibit 19-1 -Refer to Exhibit 19-1. The demand for the good represented by demand curve D₁ is

Accepted Answer

The answer of Exhibit 19-1
​
 
-Refer to Exhibit 19-1. The...

Question 5

Suppose the demand for a particular good is perfectly inelastic and the government decides to impose a tax on the production of this good. Who will pay the greater share of such a tax?

Accepted Answer

When demand is perfectly inelastic, consumers are willing to pay any price for the good, meaning the entire tax burden falls on the buyers as they absorb the full cost increase.

Question 6

The quantity supplied of land is constant regardless of price. Suppose a tax is imposed on the rental price of land. Who will pay the greater share of such a tax?

Accepted Answer

Since the supply of land is perfectly inelastic (quantity supplied does not change with price), the sellers (landowners) cannot pass the tax onto buyers through higher prices. Therefore, the sellers will bear the entire burden of the tax.

Question 7

The longer the period of time allowed for the ___________ of a good to adjust to a change in the price of the good, the ___________ the price elasticity of supply will be. This statement assumes that the quantity supplied __________ be altered with time.

Accepted Answer

The correct answer is A) producer; higher; can. This is because the longer the period allowed for the production of a good to adjust to a price change, the more producers can respond by increasing or decreasing supply, making the price elasticity of supply higher. The assumption is that the quantity supplied can indeed be altered given enough time.

Question 8

Price elasticity of supply is perfectly inelastic if the coefficient of price elasticity of supply is

Accepted Answer

Price elasticity of supply is perfectly inelastic when the coefficient of price elasticity of supply is 0, indicating that the quantity supplied does not change in response to a price change.

Question 9

The demand curve for good X is generally highly inelastic at and around the current price. If we assume that the supply curve is neither perfectly elastic nor perfectly inelastic, then who will pay the greater share of a tax placed on the production of good X?

Accepted Answer

When the demand for a good is highly inelastic, consumers are less sensitive to price changes. Therefore, if a tax is placed on the production of such a good, the buyers will tend to absorb a greater share of the tax because they are less likely to reduce their quantity demanded in response to the price increase caused by the tax.

Question 10

Exhibit 19-1 -Refer to Exhibit 19-l. The demand for the good represented by demand curve D₂ is

Accepted Answer

The answer of Exhibit 19-1
​
 
-Refer to Exhibit 19-l. The...

Question 11

Exhibit 19-1 -Refer to Exhibit 19-l. The demand for the good represented by demand curve D₃ is

Accepted Answer

The demand curve D₃, as described, suggests a varying elasticity along the curve. Demand is more elastic at higher prices because a small change in price results in a larger change in quantity demanded. Conversely, at lower prices, demand becomes less elastic as the same change in price results in a smaller change in quantity demanded. This characteristic is typical of demand curves that are not perfectly elastic or inelastic, indicating that elasticity varies at different points along the curve.

Question 12

Exhibit 19-2
​
 
-Refer to Exhibit 19-2. The market for good X is initially in equilibrium at $5. The government then places a tax on the producers of good X, taxing them on each unit of good X they sell. As a result, the supply curve

Accepted Answer

When a tax is placed on producers, it increases their costs of production, leading to a decrease in supply. This is represented by a leftward (and upward) shift of the supply curve.

Question 13

If the percentage change in quantity demanded of a good is equal to the percentage change in buyer's income, then the good is said to be

Accepted Answer

When the percentage change in quantity demanded of a good is equal to the percentage change in buyer's income, the good is said to be income unit elastic. This means that the income elasticity of demand is equal to 1.

Question 14

If for good Z income elasticity is less than 1 but greater than zero, then demand for good Z is income __________, and good Z is a(n) __________ good.

Accepted Answer

When the income elasticity of demand is less than 1 but greater than zero, it indicates that demand increases with income, but at a slower rate than the increase in income, classifying the good as a normal good with inelastic demand with respect to income.

Question 15

If the percentage change in quantity demanded of a good is less than the percentage change in buyer's income, then the good is said to be

Accepted Answer

If the percentage change in quantity demanded of a good is less than the percentage change in buyer's income, the good is considered to be income inelastic. This means that the demand for the good does not respond strongly to changes in income.

Question 16

Price elasticity of supply is the percentage change in the quantity __________ of a good divided by the percentage change in __________.

Accepted Answer

Price elasticity of supply measures how much the quantity supplied of a good responds to a change in the price of that good, hence the correct answer is the percentage change in quantity supplied divided by the percentage change in the price of the good.

Question 17

Suppose a producer decides that if the price of his or her product is $10, the quantity supplied will be 1,000 units, and if the price is $11, the quantity supplied will be 1,100. The supply of the good is

Accepted Answer

The answer of Suppose a producer decides that if the...

Question 18

An inferior good is

Accepted Answer

An inferior good is defined as a good for which demand increases when consumer income decreases, as consumers opt for cheaper alternatives when they have less money to spend.

Question 19

A normal good is

Accepted Answer

A normal good is defined as a good for which demand increases as the income of the consumer increases. This is in contrast to inferior goods, where demand decreases as consumer income rises.

Question 20

If good Z has an income elasticity of 1.0, then demand for good Z is income __________ and the good is __________.

Accepted Answer

An income elasticity of 1.0 means that the demand for good Z changes proportionally with income, which is defined as unit elastic. Since the elasticity is positive, good Z is considered a normal good, as demand increases with an increase in income.

Quiz 19: Elasticity

Exhibit 19-2 -Refer to Exhibit 19-2. The market for good X is initially in equilibrium at $5. The government then places a per-unit tax on good X, as shown by the shift of S₁ to S₂. As a result, the equilibrium price

Suppose a producer decides that if the price of her product is $42, the quantity supplied will be 1,000 units, and if the price is $45, the quantity supplied will be 1,300. The price elasticity of supply for the good is approximately

If for good Z income elasticity is greater than 1, then demand for good Z is income , and good Z is a(n) good.

Exhibit 19-1 -Refer to Exhibit 19-1. The demand for the good represented by demand curve D₁ is

Suppose the demand for a particular good is perfectly inelastic and the government decides to impose a tax on the production of this good. Who will pay the greater share of such a tax?

The quantity supplied of land is constant regardless of price. Suppose a tax is imposed on the rental price of land. Who will pay the greater share of such a tax?

The longer the period of time allowed for the _____ of a good to adjust to a change in the price of the good, the _ the price elasticity of supply will be. This statement assumes that the quantity supplied ______ be altered with time.

Price elasticity of supply is perfectly inelastic if the coefficient of price elasticity of supply is

The demand curve for good X is generally highly inelastic at and around the current price. If we assume that the supply curve is neither perfectly elastic nor perfectly inelastic, then who will pay the greater share of a tax placed on the production of good X?

Exhibit 19-1 -Refer to Exhibit 19-l. The demand for the good represented by demand curve D₂ is

Exhibit 19-1 -Refer to Exhibit 19-l. The demand for the good represented by demand curve D₃ is

Exhibit 19-2 -Refer to Exhibit 19-2. The market for good X is initially in equilibrium at $5. The government then places a tax on the producers of good X, taxing them on each unit of good X they sell. As a result, the supply curve

If the percentage change in quantity demanded of a good is equal to the percentage change in buyer's income, then the good is said to be

If for good Z income elasticity is less than 1 but greater than zero, then demand for good Z is income , and good Z is a(n) good.

If the percentage change in quantity demanded of a good is less than the percentage change in buyer's income, then the good is said to be

Price elasticity of supply is the percentage change in the quantity of a good divided by the percentage change in .

Suppose a producer decides that if the price of his or her product is $10, the quantity supplied will be 1,000 units, and if the price is $11, the quantity supplied will be 1,100. The supply of the good is

An inferior good is

A normal good is

If good Z has an income elasticity of 1.0, then demand for good Z is income and the good is .

Quiz 19: Elasticity

Exhibit 19-2 ​ -Refer to Exhibit 19-2. The market for good X is initially in equilibrium at $5. The government then places a per-unit tax on good X, as shown by the shift of S1 to S2. As a result, the equilibrium price

Suppose a producer decides that if the price of her product is $42, the quantity supplied will be 1,000 units, and if the price is $45, the quantity supplied will be 1,300. The price elasticity of supply for the good is approximately

If for good Z income elasticity is greater than 1, then demand for good Z is income __________, and good Z is a(n) __________ good.

Exhibit 19-1 ​ -Refer to Exhibit 19-1. The demand for the good represented by demand curve D1 is

Suppose the demand for a particular good is perfectly inelastic and the government decides to impose a tax on the production of this good. Who will pay the greater share of such a tax?

The quantity supplied of land is constant regardless of price. Suppose a tax is imposed on the rental price of land. Who will pay the greater share of such a tax?

The longer the period of time allowed for the ___________ of a good to adjust to a change in the price of the good, the ___________ the price elasticity of supply will be. This statement assumes that the quantity supplied __________ be altered with time.

Price elasticity of supply is perfectly inelastic if the coefficient of price elasticity of supply is

The demand curve for good X is generally highly inelastic at and around the current price. If we assume that the supply curve is neither perfectly elastic nor perfectly inelastic, then who will pay the greater share of a tax placed on the production of good X?

Exhibit 19-1 ​ -Refer to Exhibit 19-l. The demand for the good represented by demand curve D2 is

Exhibit 19-1 ​ -Refer to Exhibit 19-l. The demand for the good represented by demand curve D3 is

Exhibit 19-2 ​ -Refer to Exhibit 19-2. The market for good X is initially in equilibrium at $5. The government then places a tax on the producers of good X, taxing them on each unit of good X they sell. As a result, the supply curve

If the percentage change in quantity demanded of a good is equal to the percentage change in buyer's income, then the good is said to be

If for good Z income elasticity is less than 1 but greater than zero, then demand for good Z is income __________, and good Z is a(n) __________ good.

If the percentage change in quantity demanded of a good is less than the percentage change in buyer's income, then the good is said to be

Price elasticity of supply is the percentage change in the quantity __________ of a good divided by the percentage change in __________.

Suppose a producer decides that if the price of his or her product is $10, the quantity supplied will be 1,000 units, and if the price is $11, the quantity supplied will be 1,100. The supply of the good is

An inferior good is

A normal good is

If good Z has an income elasticity of 1.0, then demand for good Z is income __________ and the good is __________.

Exhibit 19-2 -Refer to Exhibit 19-2. The market for good X is initially in equilibrium at $5. The government then places a per-unit tax on good X, as shown by the shift of S₁ to S₂. As a result, the equilibrium price

If for good Z income elasticity is greater than 1, then demand for good Z is income , and good Z is a(n) good.

Exhibit 19-1 -Refer to Exhibit 19-1. The demand for the good represented by demand curve D₁ is

The longer the period of time allowed for the _____ of a good to adjust to a change in the price of the good, the _ the price elasticity of supply will be. This statement assumes that the quantity supplied ______ be altered with time.

Exhibit 19-1 -Refer to Exhibit 19-l. The demand for the good represented by demand curve D₂ is

Exhibit 19-1 -Refer to Exhibit 19-l. The demand for the good represented by demand curve D₃ is

Exhibit 19-2 -Refer to Exhibit 19-2. The market for good X is initially in equilibrium at $5. The government then places a tax on the producers of good X, taxing them on each unit of good X they sell. As a result, the supply curve

If for good Z income elasticity is less than 1 but greater than zero, then demand for good Z is income , and good Z is a(n) good.

Price elasticity of supply is the percentage change in the quantity of a good divided by the percentage change in .

If good Z has an income elasticity of 1.0, then demand for good Z is income and the good is .