16. Demand is said to be elastic ifa. the price of the good responds substantially to changes in demand.b. demand shifts substantially when the price of the good changes.c. buyers do not respond much to changes in the price of the good.d. the quantity demanded responds substantially to changes in the price of the good.17. If a good is a necessity, demand for the good would tend to bea. elastic.b. horizontal.c. unit elastic.d. inelastic.18. In the case of perfectly inelastic demand,a. quantity demanded stays the same regardless of price changes.b. huge changes in quantity demanded result from very small changes in the price.c. the change in quantity demanded exactly equals the change in price.d. the change in quantity demanded will be twice the change in price.19. Suppose that you produce jewellery boxes. If the demand for jewellery boxes is elastic and youwant to increase your total revenue, you shoulda. increase the price of your jewellery boxes.b. decrease the price of your jewellery boxes.c. not change the price of your jewellery boxes.d. None of the above answers are correct.20. If a 6 percent increase in income results na 10 percent increase in the quantity demanded of pizza,then the income elasticity of demand for pizza isa. negative and therefore pizza is an normal good.b. negative and therefore pizza is a inferior good.c. positive and therefore pizza is an inferior good.d. positive and therefore pizza is a normal good.21. If the cross-price elasticity of two goods is negative, then those two goods area. substitutes.b. complements.c. normal goods.d. inferior goods.

Elasticity of demand is the responsiveness of the change in quantity demand to the change in…

16. Demand is said to be elastic if a. the price of the good responds substantially to changes in demand. b. demand shifts substantially when the price of the good changes. c. buyers do not respond much to changes in the price of the good. d. the quantity demanded responds substantially to changes in the price of the good.