If rice is an inferior, then: A decrease in income causes increase in quantity demanded, shifts...

If rice is an inferior, then:

A decrease in income causes increase in quantity demanded, shifts D curve to the right
A decrease in income causes increase in quantity demanded, shifts S curve to the right
A decrease in income causes increase in quantity demanded, shifts D curve to the left
A decrease in income causes increase in quantity demanded, shifts S curve to the left

Suppose a producer is able to separate customers into two groups, one having an inelastic demand and the other having an elastic demand. If the producer’s objective is to increase total revenue, he should:

Decrease the price charged to customer with the elastic demand and increase the price charged to customer with the inelastic demand
Increase the price for both groups of customers
Increase the price charged to customer with the elastic demand and decrease the price charged to customer with the inelastic demand
decrease the price for both groups of customers

Which of the following is likely to have the most price inelastic demand?

MP3 players
Laptop computers
Designer jeans
School fees for students

If chicken is a normal good, then:

An increase in income causes increase in quantity demanded, shifts D curve to the left
An increase in income causes increase in quantity demanded, shifts S curve to the left
An increase in income causes increase in quantity demanded, shifts D curve to the right
An increase in income causes increase in quantity demanded, shifts S curve to the right

Expert Solution

1) Solution: A decrease in income causes increase in quantity demanded, shifts D curve to the right
Explanation: When the good is an inferior good the demand will be negatively related to income. A rise in income shifts D curves for inferior goods to the left.
2) Solution: decrease the price charged to customers with the price elastic demand and increase the price charged to customers with the price inelastic demand
Explanation: The consumers with an elastic demand should not be charged high while consumers with an inelastic demand should be charged high
3) Solution: School fees for students
Explanation: Inelastic demand arises when the demand of buyers does not change with the price changes.
4) Solution: An increase in income causes increase in quantity demanded, shifts D curve to the right
Explanation: When the good is a normal good the demand will be positively related to income. A rise in income shifts D curves for normal goods to the right

Rahul Sunny answered 2 years ago

An increase or decrease in the quantity supplied or demanded represents supply/demand curve; An increase or...

An increase or decrease in the quantity supplied or demanded represents supply/demand curve; An increase or decrease in supply or demand represents represents supply/demand curve

3. An increase or decrease in the quantity supplied or demanded represents supply/demand curve; An increase...

3. An increase or decrease in the quantity supplied or demanded represents supply/demand curve; An increase or decrease in supply or demand represents represents supply/demand curve a movement along a; a shift of the entire b a change in the slope of a; a new c a shift of the entire; movement along d a new; a change in the slope of a 24. At what point would an economy move from inflation to hyperinflation? a When there is a...

2.2Why does an increase in the federal funds rate decrease the quantity of reserves demanded? At...

2.2Why does an increase in the federal funds rate decrease the quantity of reserves demanded? At what interest rate does the demand curve for reserves become perfectly elastic? 2.3 Briefly explain what determines the supply curve for reserves. Why does the supply curve have a horizontal segment?

"If the price of a commodity increases the quantity demanded can increase, decrease, or remain unchanged."...

"If the price of a commodity increases the quantity demanded can increase, decrease, or remain unchanged." While seemingly contradictory, each of these two statements is correct when placed in the proper context. Carefully demonstrate and explain the proper context for each of these statements.

An increase in the demand for notebooks raises the quantity of notebooks demanded but not the quantity supplied.

“An increase in the demand for notebooks raises the quantity of notebooks demanded but not the quantity supplied.” Is this statement true or false? Explain in details.

Explain fully the difference between an increase in demand and an increase in quantity demanded. Be...

Explain fully the difference between an increase in demand and an increase in quantity demanded. Be sure to explain increase, not change or decrease. Provide at least four reasons for an increase in demand. Use appropriate graphs to illustrate your answer.

f. If a 2 percent decrease in the price of strawberries increases the quantity demanded of...

f. If a 2 percent decrease in the price of strawberries increases the quantity demanded of strawberries by 6 percent and increases the quantity of whipped cream demanded by 5 percent, calculate: i. Price elasticity of demand for strawberries. (1 mark for correct calculation, I mark for interpretation). 6% ------=3 Price elasticity of demand for strawberries is relatively elastic. -2% ii. Cross elasticity of demand for whipping cream with respect to the price of strawberries. (1 mark for correct calculation,...

When demand is very elastic then if price rise then the quantity demanded will decrease in...

When demand is very elastic then if price rise then the quantity demanded will decrease in a big amount. When supply is very inelastic then if the sellers' received amount fall due to tax then the quantity supplied will not decrease too much. Hence if demand is very elastic and supply is very inelastic then consumers will bear a small amount of whole tax burden where producers will bear a large amount of whole tax burden. Now, if demand is...

Explain the difference between an increase in demand and an increase in quantity demanded. Draw separate...

Explain the difference between an increase in demand and an increase in quantity demanded. Draw separate graphs of each to help support your answer. (Be sure you have addressed why each of these changes have occurred

1. At a given quantity of a product demanded, an increase in demand for the product...

1. At a given quantity of a product demanded, an increase in demand for the product results in a rise in marginal revenue and hence the marginal revenue product of labor and demand for labor. Select one: a. TRUE b. FALSE 2. The "trilemma" concept refers to the fact that a nation may simultaneously select a combination of any two, but not all three, of the following: Select one: a. a managed, dirty float for the exchange rate; a non-independent...

Question