Question 1
What is meant by elasticity?
A.
Reduce elastic supply in long run. B.
Costs not recovered on exit — affect firm decisions. C.
Easier storage allows more elastic supply. D.
Measure of responsiveness.
Question 2
What is meant by long run?
A.
All factors variable — supply more elastic. B.
Costs not recovered on exit — affect firm decisions. C.
PES = 0 — fixed quantity. D.
Reduce elastic supply in long run.
Question 3
What is meant by barriers to entry?
A.
PES 0 to +1 — steep S curve. B.
PES > +1 — shallow S curve. C.
Reduce elastic supply in long run. D.
Easier storage allows more elastic supply.
Question 4
What is meant by spare capacity?
A.
PES = 0 — fixed quantity. B.
PES > +1 — shallow S curve. C.
PES 0 to +1 — steep S curve. D.
Firms below max output can respond quickly.
Question 5
What is meant by pes?
A.
% change in Qs ÷ % change in P. B.
PES > +1 — shallow S curve. C.
Measure of responsiveness. D.
PES = +1.
Question 6
PES measures responsiveness of:
A.
Demand to income B.
Government spending C.
Demand to price only D.
Supply to price
Question 7
What is meant by elastic supply?
A.
Costs not recovered on exit — affect firm decisions. B.
Reduce elastic supply in long run. C.
PES > +1 — shallow S curve. D.
Measure of responsiveness.
Question 8
What is meant by unit elastic supply?
A.
Firms below max output can respond quickly. B.
PES = 0 — fixed quantity. C.
PES = +1. D.
PES > +1 — shallow S curve.
Question 9
In the long run supply is usually:
A.
More inelastic B.
Perfectly inelastic C.
Zero D.
More elastic
Question 10
What is meant by short run?
A.
Costs not recovered on exit — affect firm decisions. B.
At least one factor fixed. C.
Measure of responsiveness. D.
Reduce elastic supply in long run.
Back to practice 