Question : 101) If a 2 percent rise in price leads to : 1239039

101) If a 2 percent rise in price leads to a 4 percent decrease in quantity demanded, then demand is

A) elastic and total revenue decreases.

B) elastic and total revenue increases.

C) inelastic and total revenue decreases.

D) elastic, but we cannot tell what happens to total revenue without more information.

E) Total revenue decreases but we cannot tell if the demand is elastic or inelastic without more information.

102) If the demand for insulin is inelastic, an increase in insulin prices leads to

A) less total revenue for insulin makers.

B) more total revenue for insulin makers.

C) no change in total revenue for insulin makers.

D) first a decrease, then an increase in total revenue for insulin makers.

E) Total revenue probably changes, but we need more information about the change in total expenditures on insulin to determine if the total revenue rises, falls, or stays the same.

103) If the price elasticity of demand for gasoline equals 0.3, then an increase in the price of a gallon of gasoline from $3.70 to $3.90

A) decreases total revenue.

B) increases total revenue.

C) leads to no change in total revenue.

D) makes the demand for gasoline elastic.

E) Both answers B and D are correct.

104) If a Pizza Hut raises the price of a slice of pizza from $3.00 to $3.25, the quantity demanded decreases from 1,500 slices per week to 1,300 slices per week. The demand for slices of pizza is ________ and the total revenue received by this Pizza Hut ________.

A) elastic; decreases

B) inelastic; decreases

C) elastic; increases

D) inelastic; increases

E) unit elastic; does not change

105) If an Atlanta bakery raises the price of their rye bread by 11 percent and the quantity demanded decreases by 11 percent, then the demand for the rye bread is ________ and the bakery’s total revenue ________.

A) unit elastic; does not change

B) unit elastic; increases

C) unit elastic; decreases

D) elastic; does not change

E) inelastic; does not change

106) Suppose the Oakland Raiders football team increases their season ticket prices and total revenue from ticket sales falls, but not to zero. This fact means that the demand for Raiders tickets is

A) inelastic.

B) elastic.

C) unit elastic.

D) perfectly elastic.

E) perfectly inelastic.

107) After long hair for men became popular, barbers found that their incomes fell. In an attempt to boost their incomes, many barbers raised the price of a haircut and yet their total revenue fell even more. What can explain this result?

A) The demand for haircuts by barbers is elastic because of many substitutes.

B) The demand for haircuts by barbers became inelastic after the increase in price.

C) Haircuts are inferior products.

D) The demand for haircuts by barbers is inelastic because most people need haircuts.

E) None of the above can explain the phenomenon.

108) Taco Bell firm raises the price of its tacos. The price elasticity of demand for Taco Bell tacos equals 5.0. What happens to the Taco Bell’s total revenue?

A) nothing

B) It increases.

C) It decreases.

D) It becomes negative.

E) It might change, but more information is needed to determine if it increases, decreases, or does not change.

109) Pizza Hut lowers the price of its pizza. The price elasticity of demand for Pizza Hut pizza equals 0.3. What happens to the Pizza Hut’s total revenue?

A) nothing

B) It increases.

C) It decreases.

D) It becomes negative.

E) It might change, but more information is needed to determine if it increases, decreases, or does not change.

110) KFC raises the price of its grilled chicken. The price elasticity of demand for KFC grilled chicken is 0.8. What happens to the KFC’s total revenue?

A) nothing

B) It increases.

C) It decreases.

D) It becomes negative.

E) It might change, but more information is needed to determine if it increases, decreases, or does not change.