25) Which statement is TRUE? Elasticity of demand attempts to measure how fast quantity demanded increases when price increases. The elasticity of demand is always the same as the elasticity of supply. If the elasticity of demand is –4, then economists know that the price is increasing at a faster rate than quantity demanded. The price elasticity of demand is always a negative number, but economists generally ignore the negative sign.
25) Which statement is TRUE? Elasticity of demand attempts to measure how fast quantity demanded increases when price increases. The elasticity of demand is always the same as the elasticity of supply. If the elasticity of demand is –4, then economists know that the price is increasing at a faster rate than quantity demanded. The price elasticity of demand is always a negative number, but economists generally ignore the negative sign.
Chapter5: Elasticity Of Demand And Supply
Section: Chapter Questions
Problem 3.6P: (Price Elasticity of Supply) Calculate the price elasticity of supply for each of the following...
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25) Which statement is TRUE?
Elasticity of demand attempts to measure how fast quantity demanded increases when price increases.
The elasticity of demand is always the same as the elasticity of supply.
If the elasticity of demand is –4, then economists know that the price is increasing at a faster rate than quantity demanded.
The price elasticity of demand is always a negative number, but economists generally ignore the negative sign.
28) To draw a demand curve for commodity X, the only information needed is the total utility received from X.
True
False
31) Which statement is FALSE?
The consumer is assumed to maximize marginal utility .
Marginal utility is usually smaller than total utility.
Marginal utility generally diminishes as more of a good is consumed.
To calculate total utility, sum the marginal utilities of the individual units consumed.
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