Question : 38) Suppose the demand curve for a product represented by : 1387557

38) Suppose the demand curve for a product is represented by a typical downward-sloping curve. Now suppose the demand for this product increases. Which of the following statements accurately predicts the resulting increase in price?

A) The more elastic the supply curve, the greater the price increase.

B) The more elastic the supply curve, the smaller the price increase.

C) The increase in price is not affected by the elasticity of the supply curve.

D) There will be no increase in price if the supply curve is perfectly inelastic.

39) Suppose the demand curve for hybrid cars shifts to the right. This will cause a relatively small increase in the price of hybrid cars if

A) demand is elastic and supply is inelastic.

B) demand is inelastic and supply is elastic.

C) both demand and supply are inelastic.

D) both demand and supply are elastic.

40) The process involved in bringing oil to world markets can take years. Substitutes for oil-based products such as gasoline are limited. As a result

A) the supply of oil is very elastic and the demand for oil is very elastic over short periods of time.

B) the supply of oil is very inelastic and the demand for gasoline is inelastic over short periods of time.

C) the supply of oil and the demand for oil shift to the right over short periods of time.

D) the supply of oil and the demand for oil are both perfectly elastic over short periods of time.

41) Shifts in the supply of oil have caused large changes in price since the 1970s because

A) the supply of oil is very inelastic while the demand for oil is very elastic over short periods of time.

B) the supply of oil is very elastic while the demand for oil is inelastic over short periods of time.

C) both the supply of oil and the demand for oil are inelastic over short periods of time.

D) the supply of oil and the demand for oil are perfectly elastic over short periods of time.

42) Which of the following statements is true?

A) The supply of oil is very elastic over short time periods but becomes perfectly inelastic over time. A given shift in supply results in a greater increase in the price of oil when the supply of oil is perfectly inelastic.

B) The supply of oil is very inelastic over short time periods but becomes more elastic over time. A given shift in supply results in a smaller increase in the price of oil when the supply is more elastic.

C) The supply of oil is perfectly inelastic; therefore, as the demand for oil increases over time the price of oil increases significantly.

D) Over short periods of time, increases in the demand for oil are greater than increases in the supply of oil. Over the long run, increases in the demand and the supply of oil are about equal. As a result, the price of oil increases greatly in the short run but is stable in the long run.

43) The price elasticity of supply is calculated as the change in supply divided by the change in price.

44) Suppose the supply curve for digital cameras shifts to the right. This will cause a relatively large decrease in the price of digital cameras if both demand and supply are inelastic.

45) The value of the price elasticity of supply depends primarily on how quickly firms can acquire inputs to increase quantity supplied when price increases.

46) Supply is elastic whenever the elasticity value for supply is positive and greater than 1.

47) There are a limited number of original Picasso paintings. This means that the supply of original Picasso paintings is perfectly inelastic.