1. If the price elasticity of demand is -0.8 and the firm increases price, revenue will a. Increase b. Decrease C. Stay constant d. become zero, they would lose all their customers
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- 13. If the price elasticity of demand is 1.0, and a firm raises its price by 10 percent, the total revenue will... a. Not change b. Fall by 10 percent c. Rise by 10 percent d. Rise by 100 percentFor which product is the income elasticity of demand most likely to be negative? A. BreadB. GasC. Generic beerD. MilkThe demand for rice: a. have the same elasticity with the soft drink b. is more elastic than the demand for car c. all of the above d. have finite utility
- suppose a pharmaceutical company considers increasing the price of insulin tm $125 per vial to $300 per vial. whenthe price was $125, the company sold 100, 000 vials per day. the company knows its price elasticity is .25. calculate thepercentage change in quantity demanded that would result in a price elasticity of .25. show your workWhat will be the value of price elasticity if the demand for a product is relatively elastic? a. Equal to one b. Equal to zero c. Greater than one d. Less than oneIf the price elasticity of demand is unit then a fall in price: a. Leaves total revenue unchanged O b. Increases total revenue c. Reduces costs O d. Reduces total revenue
- QUESTION 9 When the income elasticity of demand is negative then products are normal. O True FalseThe price elasticity of demand for a popular sporting event is 0.4. If the price of a ticket to this event increases by 10 percent, the quantity of tickets demanded will: A. Increase by 4 percentB. Increase by 14 percentC. Decrease by 4 percentD. Decrease by 14 percent2. An exclusive Yoghurt manufacturer sells 4,000 gallons per month at a price of GHS 40 cach. When the price is reduced to GHS 30 sales increase to 6,000 gallons per month. a. Calculate the price elasticity of demand for the Yoghurts over this price range. b. Is demand elastic, unit elastic or inelastic? c. Calculate the change in revenue due to the change in price.
- Good or Service Price Elasticity Income Elasticity Beef -0.5 0.51 Long Distance Telephone -0.32 1.2 Cigarettes All smokers -0.7 0.9 Ages 15-18 -1.4 1.5 What will happen to sales for long-distance telephone if its price increases by 5% and income increases by 8%? Select one: a. Sales will decrease by 5%. b. Sales will increase by 5%. c. Sales will decrease by 8%. d. Sales will increase by 8%.When Maha earned AED 17,000 per month, he used to spend 1,000 dirham a months in supermarket A. Now that he earns AED 28,000 per month, he spends 1200 dirham in supermarket A every month. A. Calculate income elasticity of demand B. What type of products do supermarket A sells according to your result in A? Explain.7.you are the manager of a feed store in Millican and the supply cost of Purina cattle mineral is increasing. a. You must fill in the following table and answer the following questions. The elasticity of demand is -1.50 (hint: use this to calculate the quantity demanded when the sales price changes B.