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Understanding Economic Demand and Elasticity

Learn about demand in economics, demand schedules, curves, elasticity factors, and how the market economy works. Explore the difference between elastic and inelastic demand and factors affecting demand curves.

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Understanding Economic Demand and Elasticity

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  1. CH 4 Review

  2. Questions

  3. Question 1 Which letter represents elastic demand?

  4. Question 2 • Which letter represents a demand schedule?

  5. Question 3 • Which letter represents a change in demand?

  6. Question 4 • Which letter represents unite elastic demand?

  7. Question 5 • Which letter represents a demand curve?

  8. Question 6 • Which letter represents a schedule showing change in quantity demanded?

  9. Question 7 • Which letter represents inelastic demand?

  10. Question 8 • Explain what demand means in economics?

  11. Question 9 • Describe a demand schedule and a demand curve and how they are alike?

  12. Question 10 • Explain why the demand curve is downward-sloping

  13. Question 11 • Describe the difference between a change in quantity demanded and and a change in demand

  14. Question 12 • Identify the 3 factors that can cause a change in the level of demand

  15. Question 13 • Explain how the principle of diminishing marginal utility is related to the downward-sloping demand curve

  16. Question 14 • Describe the difference between elastic and inelastic demand

  17. Question 15 • Explain how the total receipts test can be used to determine demand elasticity

  18. Question 16 • List the 3 determinants of demand elasticity and how it effects the demand curve

  19. Answers

  20. Answer 1 E

  21. Answer 2 B

  22. Answer 3 D

  23. Answer 4 G

  24. Answer 5 A

  25. Answer 6 C

  26. Answer 7 F

  27. Answer 8 • Demand in economics is knowing how the market economy works and aids in sound business practices

  28. Answer 9 • A demand schedule is a listing that shows the quantity demand at all prices in the market at a given time

  29. Answer 9 Cont. • A demand curve tells the quantity demanded at each and every price

  30. Answer 9 Cont. • The schedule present the information in table while the graph gives the same information in the form of a line

  31. Answer 10 • Because there will be more demand for a item the lower the price gets

  32. Answer 11 • Change in quantity demanded is a change in quantity due to a change in price

  33. Answer 11 Cont. • Change in demand is when demand changes even though prices does not

  34. Answer 12 • Consumer demand • Consumer taste • Prices of related products

  35. Answer 13 • Because with each additional product bought the utility becomes less so producers have to find other way to get customers to buy more

  36. Answer 14 • Elastic demand is when a small change in price creates a big change in demand

  37. Answer 14 Cont. • Inelastic demand is when a change in price causes a relatively small change in demand

  38. Answer 15 • By comparing and observing changes in total revenue/receipts when the price changes can then be tested for elasticity

  39. Answer 16 • Can the purchase be delayed? • Are adequate substitutes available? • Does the purchase use a large portion of income?

  40. Answer 16 Cont. • It changes the slope of the line

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