Suppose demand for a good is QD = 100 - P and supply is QS = -20 + P. What is the amount consumers pay producers?

If a 10 percent increase in price leads to a 20 percent increase in the quantity supplied, then the elasticity of supply is 0.5

a. True b. False Indicate whether the statement is true or false

The prices that people are willing to pay for goods and services mostly depend on:

a. the total utility derived from the goods and services. b. the marginal utility derived from the goods and services. c. the availability of raw materials for producing the goods and services. d. the cost of producing the goods and services. e. whether the goods are legal, since the laws affect the position of both supply and demand curves.