Question : 92) The price of the good multiplied by the quantity : 1241496

 

92) The price of the good multiplied by the quantity sold is its

A) total revenue.

B) total cost.

C) total spending.

D) total income.

E) total quantity.

 

93) Total revenue equals

A) price × quantity sold.

B) profit – cost.

C) price.

D) quantity sold – cost.

E) cost × price.

94) The total revenue test says

i)Demand is elastic if a decrease in price results in an increase in total revenue.

ii)Total revenue is maximized when demand is elastic.

iii)Total revenue is minimized when demand is unit elastic.

A) i only

B) i and ii

C) ii and iii

D) i, ii and iii

E) ii only

 

95) If demand is price inelastic and the price is lowered, which of the following occurs?

A) The quantity sold decreases.

B) The total expenditure increases and the total revenue decreases.

C) The total revenue of the firms selling the product is unchanged.

D) The total revenue of the firms selling the product decreases.

E) The total expenditure decreases and the total revenue increases.

 

96) If demand is inelastic and the price falls, the total revenue

A) rises.

B) falls.

C) remains constant.

D) might rise, fall, or remain constant.

E) becomes negative.

97) Total revenue increases if the price of the good

A) rises and demand is elastic.

B) rises and demand is inelastic.

C) rises and demand is unit elastic.

D) falls and supply is inelastic.

E) falls and demand is unit elastic.

 

98) If the supply of a good decreases and it causes total revenue to increase, this shows that the good has an

A) inelastic demand

B) elastic demand

C) unit elastic demand

D) inelastic supply

E) elastic supply

 

99) You own a small store. Your cashier thinks you should raise prices to increase your total revenue and your customer thinks you should lower prices to increase your total revenue. The cashier thinks the price elasticity of demand is ________ and the customer believes the price elasticity of demand is ________.

A) inelastic; elastic

B) elastic; inelastic

C) elastic; elastic

D) inelastic; inelastic

E) unit elastic; elastic

100) Products X, Y, and Z have price elasticities of 3.0, 0.80, and 1.0 respectively. Total revenue decreases if the price of

A) product X falls.

B) product Y falls.

C) product Z falls.

D) product X or product Z falls.

E) product Y or product Z falls.

 

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.