Download Jeopardy Elasticity

Unit 4 –ELASTICITY
JEOPARDY
Categories
Terms / Concepts
Terms /
Concepts
2 – T/F
Excise Taxes
Miscellaneous Calculations
100
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400
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500
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500
Price Elasticity of
demand is inelastic
if the coefficient is…
An elastic demand
curve looks like
this… Draw it!
 If prices increase while
the price elasticity of
demand is elastic, what
happens to a firm’s Total
Revenue?
 What does a negative
Income elasticity
coefficient indicate
about the product?
 When do we consumers
end up paying more of
the sales tax? Why?
(refer to elasticity here)
T / F? Change the false!
 Total Revenue =
Income x Quantity Traded
 Name the 3
determinants of price
elasticity of demand.
T / F? Change the false!
 If demand is inelastic and
price falls, then total
revenue will increase.
T / F? Change the false!
 Supply elasticity is
measured by percentage
change in quantity
supplied divided by
percentage change in
quantity demanded
T / F? Change the false!
 A straight line (constant-
sloped) demand curve
does not imply constant
elasticity.
 What are
Equilibrium
Price and
Quantity
BEFORE tax?
What is the
dollar
amount
of the tax?
 What are the
new equilibrium
price and
quantity? How
much of the tax
are we
consumers
paying?
 How much of the tax are
sellers paying?
 Looking at the tax paid
and the graph below,
what can you
Conclude about
this product?
Explain.
-
Cross price elasticity of
demand is a positive
value. What is the
relationship between
products A and B?
Name a product with a
perfectly inelastic
demand curve.
What is the value of price
elasticity of demand
when total revenue is
maximized? What is the
technical term for this
elasticity?
Price increased by 20%.
The price elasticity of
demand coefficient is 0.5
What is the percentage
change in the quantity
demanded?
Lisa makes bracelets and when she
charges $20 each, she sells $800/month.
One month, she lowered her price to
$18 and sold $756 worth of bracelets.
1) What is the price elasticity of demand
for Lisa’s bracelets? (Calculate #)
2) What can you say about this product’s
elasticity?
Year
Income
Price A
1
$50,000
2
Quantity A
Price B
Quantity B
$2.50 100
$20
800
$50,000
$2.80 90
$20
750
3
$50,000
$2.80 80
$30
700
4
$55,000
$2.80 90
$30
720
What is the price elasticity of
demand for A?
Year
Income
Price A
1
$50,000
2
Quantity A
Price B
Quantity B
$2.50 100
$20
800
$50,000
$2.80 90
$20
750
3
$50,000
$2.80 80
$30
700
4
$55,000
$2.80 90
$30
720
What is the price elasticity of
demand for B?
Year
Income
Price A
1
$50,000
2
Quantity A
Price B
Quantity B
$2.50 100
$20
800
$50,000
$2.80 90
$20
750
3
$50,000
$2.80 80
$30
700
4
$55,000
$2.80 90
$30
720
 What is the income
elasticity for product A?
Year
Income
Price A
1
$50,000
2
Quantity A
Price B
Quantity B
$2.50 100
$20
800
$50,000
$2.80 90
$20
750
3
$50,000
$2.80 80
$30
700
4
$55,000
$2.80 90
$30
720
What is the income
elasticity for product B?
Year
Income
Price A
1
$50,000
2
Quantity A
Price B
Quantity B
$2.50 100
$20
800
$50,000
$2.80 90
$20
750
3
$50,000
$2.80 80
$30
700
4
$55,000
$2.80 90
$30
720
What is the cross-price elasticity of demand
for A when the price of B changes? What is
the relationship between the two products?