1. Which type of good is most likely to have INELASTIC demand?
Elasticity
  1. A luxury holiday
  2. One brand among many soft drinks
  3. A life-saving medicine
  4. A designer handbag
2. If the price of a good rises by 10% and quantity demanded falls by 20%, the PED is:
Elasticity
  1. 0.5
  2. 2
  3. 10
  4. 0.2
3. If a good has a PED value greater than 1, its demand is described as:
Elasticity
  1. Inelastic
  2. Elastic
  3. Perfectly inelastic
  4. Fixed
4. Price elasticity of demand measures how much the quantity demanded responds to a change in:
Elasticity
  1. Income
  2. Price
  3. Supply
  4. The weather
5. If a price is set BELOW the equilibrium price, the market will experience a:
Supply and Demand
  1. Surplus
  2. Shortage
  3. Perfect balance
  4. Fall in demand
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