Transcript A good with many close substitutes is likely to have elastic demand

ECONOMICS 211 –
CLICKER QUESTIONS
Chapter 5 – Question Set #1
A good with many close substitutes is likely to have an
elastic demand because ______.
1.
2.
3.
If the price rises, consumers can choose
to purchase one of the close
substitutes instead
Consumers with brand loyalty won't
change their buying habits, even if the
price changes
The laws of supply and demand will
drive the equilibrium price down
92%
4%
1.
2.
4%
3.
For a good that is a necessity,
1.
2.
3.
4.
quantity demanded tends
to respond substantially to
a change in price.
demand tends to be
inelastic.
the law of demand often
does not apply.
All of the above are
correct.
76%
20%
4%
0%
1.
2.
3.
4.
Price elasticity of demand for a good depends on how one
defines the good. For example, one could look at the market for a
particular kind of food, or the market for food in general. Of the
following categories, which one has the LEAST elastic
demand?
1.
2.
3.
4.
Food
Vegetables
Bell peppers
Red bell peppers
76%
20%
4%
0%
The demand for a good is more elastic
1.
2.
3.
4.
Over one day
Over one year
Over ten years
It doesn't matter, demand has the
same elasticity over all time
periods
15%
42%
42%
0%
1.
2.
3.
4.
Consumers tend to be more sensitive to changes in
price when prices are relatively higher because
1.
2.
3.
4.
They cost more
The goods make up a
greater percentage of
their income
Consumers buy less of
goods at higher prices
The law of demand
52%
28%
20%
0%
1.
2.
3.
4.