29) For a parTicular producT The QD = 20 - 2.5 Pand Q5 = 0 + 2.5P. If The currenT price is $5, which of The following is True? A) There is a surplus of The producT in The markeT. B) The quanTiTy demanded equals The quanTiTy supplied. C) The currenT price is equal To The equilibrium price. D) There is a shorTage of The producT in The markeT. 30) If a 4 percenT increase in The price of a good leads To a 1 percenT decrease in The quanTiTy demanded, The price elasTiciTy of demand (in absoluTe value) for The good equals and demand aT This price is A) 4.0; inelasTic B) 0.25; inelasTic C) 0.25; elasTic D) 4.0: elasTic 31) AT The poinT on The demand curve aT which marginal revenue = 0, The absoluTe value of The coefficienT of The price elasTiciTy of demand is: A)=0. B)1. D): 1. 32) In The long run, The price elasTiciTy of demand is Than in The shorT run because A) less; The percenTage change is measured over a larger amounT of Time B) greaTer; consumers have more Time in which To make adjusTmenTs To price changes C) less: consumers have more Time in which To make adjusTmenTs To price changes D) greaTer: firms have more Time To shifT The burden of The Tax forward To consumers 33) AT a price of $5, consumers buy 200 uniTs of good X. When The price falls To $4, quanTiTy demanded increases To 250 uniTs. We can conclude ThaT over This range, demand is: A) perfechy inelasTic. B) inelasTic. C) elasTic. D) uniT elasTic. 34) The owner of Big P Bacon esTimaTes ThaT The price elasTiciTy of demand for a package of Their Big P bacon To be 3.48. In relaTion To The price elasTiciTy of demand for The enTire bacon markeT, which of The following is mosT likely True? A) The price elasTiciTy for all bacon will be more responsive To price changes. B) The price elasTiciTy for all bacon will be more elasTic. C) The price elasTiciTy for all bacon will be greaTer Than 3.48. D) The price elasTiciTy for all bacon will be less responsive To price changes. 35) If a 5 percenT increase in consumer incomes leads To a 10 percenT increase in The quanTiTy demanded for a good, The good is a(n) good wiTh an income elasTiciTy of A) normal; 2.0 B) normal; 0.50 C) inferior ; -2.0 D) inferior; -0.50 36) If The cross-price elasTiciTy beTween Goods X and Y is 2.0, The goods are and an increase in The price of Good X will cause a(n) in The quanTiTy demanded of Good Y. A) subsTiTuTes; increase B) complemenTs; increase C) subsTiTuTes; decrease D) complemenTs; decrease 37) The price elasTiciTy of demand for BesT PainTs one gallon sized painT cans is 0.79. If BesT PainTs increased The price of Their gallon sized painT cans by 10 percenT, which of The following is expecTed To occur? A) The quanTiTy demanded will fall by 0.79 percenT. and ToTal revenue will increase B) The quanTiTy demanded will fall by 7.9 percenT and ToTal revenue will increase. C) The quanTiTy demanded will increase by 0.79 percenT and ToTal revenue will noT change. D) The quanTiTy demanded will increase by 7.9 percenT and ToTal revenue will decrease. 7 38) You are the owner of a firm that makes generic paper products. You estimate the income elasticity for your paper towels to be -1.5. An economic recession will have which of the following effects on the demand for your paper products? A) The demand will decrease by 15 percent. B) The demand will increase. () The demand will decrease. D) There will be no effect on demand. 39) Use the following graph of total revenues to answer the question below. Total Revenue (in thousands) B 0 1 8 10 14 1617 Quantity of Product X (in thousands) An increase in the quantity of product X demanded from 16,000 to 17,000 units implies that the price of product X was A ) increased and the dem and is inelastic. B) reduced and the demand is elastic. () increased and the demand is elastic D) reduced and the demand is inelastic. 40) Suppose the demand (QD) and supply (QS) curves for CK dress shirts are given as QD = 250 - P QS = - 50 + 1.5P the equilibrium price and quantity for this product are $130 and 120 units, respectively. A ) True B) False 41) Answer Q 41 to 45 based on the following: The hourly demand for Spot ify music downloads was estimated by you and is: Qd = 500 - 100P where Qq is the quant ity or number of songs downloaded per hour and P is the price per song. Based on the above, Spot ify will sell 250 songs per hour at P = $ 2.5. A ) True B) False 42) Based on the above, the total revenue, TR, function is 5Q - 0.01Q2 A ) True B) False43) Based on the above, the marginal revenue, MR, function is 500 - 20OP A) True B) False 44) At P = $3, Spotify's TR per hour is $600. A) True B) False 45) Based on the above, TR is at maximum when Q = 200 units A) True B) False