If the demand is perfectly elastic, what would happen to the quantity demanded if there is a tiny increase in price?
a. quantity demanded will increase proportionately
b. quantity demanded will fall to zero
c. quantity demanded will register a disproportionately high increase
d. quantity demanded will decrease proportionately
b
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If the elasticity of supply for a good is greater than the government expected: a. Consumers will bear more of the burden of the tax than the government expected. b. Producers will bear more of the burden of the tax than the government expected. c. The tax will raise less revenue than the government expected
d. Both a. and c. are true.
If the aggregate demand curve shifts to the left and the aggregate supply curve shifts to the right, the result will be a
a. decrease in the level of output. b. decrease in the price level. c. higher price level. d. higher unemployment rate.