TUTORIAL CHAPTER ELASTICITY Student

TUTORIAL CHAPTER : ELASTICITY
PART A
1. Supposed that a 20% increase in the price of good Y causes a 10% increase in the
quantity demanded for good X. The coefficient of cross elasticity of demand is
________________
A. negative therefore these goods are substitutes Ep=%∆Qdx/%∆Py =+10/+20
B. negative and therefore these goods are complements =0.5 Py∆ Qx∆
C. positive and therefore these goods are substitutes
D. positive and therefore these goods are complements
definition
2. Price elasticity of supply measures____________________________________
A. substitution effect
B. income effect
C. the responsiveness of the quantity demanded due to change in its price
D. the responsiveness of the quantity supplied due to change in its price
3. The larger proportion of income spent on a product

A. the less elastic is the product’s demand curve Factors elasticity of D
B. the more elastic is the product’s demand curve
C. the more inelastic in the product’s demand curve
D. None of the above
4. The price of pizza increases by 25% and the quantity demanded of pizza falls by 20%.
This indicate that demand for pizza is _________________________ Ep=%∆Qd/%∆P =?/?
A. perfectly elastic Ep>1 Elastic
B. unitary elastic 0<Ep<1 Inelastic
C. Inelastic
D. Elastic
5. The quantity demanded of good D increases as income decreases. Good D is a/an ___
A. inferior good
B. Normal good Income Elasticity
C. Luxury good
D. Substitute good
6. The price of durians falls by 5% and quantity demanded increases by 10%. This means
that the demanded for durians is ______________________
A. perfectly inelastic Ep=%∆Qd/%∆P =?/?
B. Unitary elastic Ep>1 Elastic
C. Less elastic 0<Ep<1 Inelastic
D. Elastic
7. If two goods are complementary, a drop in the price of one good will Cross Elasticity
A. increase the demand of other good 1. Substitute
B. decrease the demand of other good 2. Complement
C. increase the quantity demanded for the other good 3. not related
D. increase the demand of both good
NOR ZARINA MOHD SALIM/FPP/UiTM PERAK/OCTOBER 2022

8. If the elasticity of demand is perfectly elastic, any increase in the price of a good may
cause quantity demanded to be
A. zero Degree Elasticity of demand
B. infinite -Perfectly elastic- horizontal D
C. negative curve
D. smaller
9. Price elasticity of demand for good W is inelastic. If the price of good W increases by
10%, what will happen to the quantity demanded for good W?
A. it will reduce by 10% Degree Elasticity of demand
B. it will reduce less than 10% -Inelastic<1=?/10%
C. it will reduce more than 10%
D. it will remain unchanged
10. If the price of air-conditioner is increases, the demand for fan is increase. The air-
conditioner and fan can be considered as
A. substitute goods Cross Elasticity
B. complementary goods Relationship- Substitute,
C. giffen goods complement, not related
D. normal goods
11. Which of the following is the determinant of price elasticity of demand?

A. The amount of income spent
B. Technology advancement Factors elasticity of D
C. Change in Cost of production
D. Perishability
12. Suppose the price of Ribena increases by 10%, the quantity supplied of Ribena
increases by 20%. Thus supply of Ribena is
A. perfectly elastic Es=%∆Qs/%∆P =?/?
B. elastic Ep>1 Elastic
C. Inelastic 0<Ep<1 Inelastic
D. unitary
13. If the price elasticity of supply is zero

Degree Elasticity of supply
A. supply is more elastic
-vertical Ss curve
B. the supply curve is horizontal
C. the quantity supply is the same, regardless of the price
D. none of the above
14. For a good that is luxury, demand is

A. elastic
B. inelastic
C. Unitary elastic
D. perfectly inelastic
15. If the elasticity of supply is 1.35, it indicates that supply is

A. Unitary elastic
B. inelastic
C. Elastic

D. perfectly inelastic
16. In general, the longer the time period, supply of product tend to be
A. Inelastic
B. Unitary elastic factors influence elasticity of supply
C. Elastic
D. Perfectly elastic
17. Products which are purchased more frequently such a sugar will tend to have
A. elastic supply
B. inelastic supply
C. elastic demand factors influence elasticity of demand
C. Elastic
D. inelastic demand
18. If the demand of thumb drive increases as income increases, thumb drive is
A. inferior good
B. normal good types of good-income elasticity
C. necessity good
D. substitute good
19. A 15% increase in the price of Baju Kurung will reduced its quantity demanded by 20%.
It can be concluded that the demand for Baju Kurung is
A. Perfectly inelastic
B. elastic
C. Inelastic
D. Unitary elastic
20. If the economist say a good is price elastic, then the price elasticity is
A. equal to 1
B. greater than 1
C. less than 1
D. equal to 0

PART B
REM155/ MARCH 2017
Pp1=1.90 Qq1=27 Pp0=2.1

Qq0=39

REM155/ MARCH 2015

ECO162/DEC 2018


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TUTORIAL CHAPTER : ELASTICITY

3. The larger proportion of income spent on a product

NOR ZARINA MOHD SALIM/FPP/UiTM PERAK/OCTOBER 2022

11. Which of the following is the determinant of price elasticity of demand?

13. If the price elasticity of supply is zero

14. For a good that is luxury, demand is

15. If the elasticity of supply is 1.35, it indicates that supply is

NOR ZARINA MOHD SALIM/FPP/UiTM PERAK/OCTOBER 2022

NOR ZARINA MOHD SALIM/FPP/UiTM PERAK/OCTOBER 2022

REM155/ MARCH 2017

Pp1=1.90 Qq1=27 Pp0=2.1

NOR ZARINA MOHD SALIM/FPP/UiTM PERAK/OCTOBER 2022

REM155/ MARCH 2015

NOR ZARINA MOHD SALIM/FPP/UiTM PERAK/OCTOBER 2022

NOR ZARINA MOHD SALIM/FPP/UiTM PERAK/OCTOBER 2022

NOR ZARINA MOHD SALIM/FPP/UiTM PERAK/OCTOBER 2022

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