When the price of CD players increases 5%, quantity demanded decreases 5%. The p

Question

When the price of CD players increases 5%, quantity demanded decreases 5%. The price elasticity for CD players is inelastic. unit elastic. elastic. perfectly inelastic. Which statement is false? The most important determinant of the degree of elasticity is the availability of substitutes. An elasticity of less than 1 is inelastic. The advertiser wants to push her product's curve to the left and make is less clastic. None of these statements are false. If demand is inelastic and price is raised quantity demanded will fall and total revenue will fall. quantity demanded will fall and total revenue will rise. quantity demanded will rise and total revenue will rise. quantity demanded will rise and total revenue will fall. If demand is elastic and price is lowered, total revenue will rise. fall. stay the same. possibly rise and possibly fall. An elasticity of 0.75 means that a 1% change in price will lead to a % change in quantity demanded. 0.25 0.75 2.5 7.5

Explanation / Answer

1. B. Unit elastic

2. D. None of these statements are false

3. B.QD will fall and TR will rise

4. A. Rise

5. B. 0.75

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