Econ Review Part 3

18 Questions | Total Attempts: 533

SettingsSettingsSettings
Economics Quizzes & Trivia

Review for my exam


Questions and Answers
  • 1. 
    If the price of a hotel room increases from $70 to $85 and the number of rooms booked decreases from 200 to 150, what would the price elasticity of demand equal? (absolute value)
    • A. 

      0.68

    • B. 

      0.91

    • C. 

      1.10

    • D. 

      1.48

    • E. 

      None of the above

  • 2. 
    If QuikTrip decreases the price of 32 ounce soft drinks in the summer from $0.79 to $0.39 and the number purchased increases from 230 to 770, what would the price elasticity of demand equal? (absolute value)
    • A. 

      0.64

    • B. 

      0.77

    • C. 

      0.93

    • D. 

      1.59

    • E. 

      None of the above

  • 3. 
    For which of the following goods would demand be most inelastic with respect to price?
    • A. 

      Soft drink at a gas station

    • B. 

      Soft drink at a movie theater

    • C. 

      Soft drink at a mall

    • D. 

      Soft drink on a college campus

    • E. 

      Soft drink at a grocery store

  • 4. 
    For which of the following goods would demand be most inelastic with respect to price?
    • A. 

      A chair from Rooms to Go

    • B. 

      An antique Queen Anne chair

    • C. 

      A UGA lawn chair

    • D. 

      Lazy chair recliner

  • 5. 
    For which of the following goods would demand be most elastic with respect to price?
    • A. 

      A hot dog and soft drink at an NFL stadium

    • B. 

      Heart surgery

    • C. 

      A gallon of gasoline

    • D. 

      Eddie Bauer jeans

    • E. 

      None of the Above

  • 6. 
    Price elasticity of demand with an absolute value of 2.5 would indicate
    • A. 

      Perfectly inelastic demand

    • B. 

      Relatively inelastic demand

    • C. 

      Demand of unitary elasticity

    • D. 

      Relatively elastic demand

    • E. 

      Perfectly elastic demand

  • 7. 
    Price elasticity of demand with an absolute value of zero would indicate
    • A. 

      Perfectly inelastic demand

    • B. 

      Relatively inelastic demand

    • C. 

      Demand of unitary elasticity

    • D. 

      Relatively elastic demand

  • 8. 
    If the demand for a good is inelastic and a producer raises his/her price, the result will be an increase in total revenue.
    • A. 

      True

    • B. 

      False

  • 9. 
    If the demand for a good is elastic and a producer lowers his/her price, the result will be an increase in total revenue.
    • A. 

      True

    • B. 

      False

  • 10. 
    If the demand for a good is elastic and a producer lowers his/her price, the result will be an increase in total revenue.
    • A. 

      True

    • B. 

      False

  • 11. 
    If the price elasticity of demand equals -2.5 and a producer raises his/her price, the result will be an increase in total revenue.
    • A. 

      True

    • B. 

      False

  • 12. 
    If a specific movie theatre increases prices by $1.00 and demand for is unitary with respect to price what will happen to total revenue?
    • A. 

      Increase

    • B. 

      Decrease

    • C. 

      no change

  • 13. 
    If a decrease in price leads to an increase in total revenue, the demand must be elastic.
    • A. 

      True

    • B. 

      False

  • 14. 
    The Laffer curve (at least in the short run) depicts an inverse relationship between inflation and unemployment.
    • A. 

      True

    • B. 

      False

  • 15. 
    Which of the following is a correct indication of the labels on the axis for the Phillips curve?
    • A. 

      Inflation is on the vertical axis and unemployment is on the horizontal axis.

    • B. 

      Unemployment is on the vertical axis and inflation is on the horizontal axis.

    • C. 

      Price is on the vertical axis and unemployment is on the horizontal axis.

    • D. 

      Price is on the vertical axis and employment is on the horizontal axis.

    • E. 

      Employment is on the vertical axis and price is on the horizontal axis.

  • 16. 
    Rational expectations create forecasts using all past information as well as the current decisions of other decision makers;
    • A. 

      True

    • B. 

      False

  • 17. 
    Adaptive expectations create forecasts using all past information as well as the current decisions of other decision makers.
    • A. 

      True

    • B. 

      False

  • 18. 
    Which of the following would be included in the U.S. GDP?
    • A. 

      A Volvo built by Ford in Gothenburg, Sweden

    • B. 

      A Hyundai built in Montgomery, Alabama

    • C. 

      A Corvette built in Bowling Green, Kentucky by General Motors

    • D. 

      All of the above

    • E. 

      B and C only

Back to Top Back to top