If the price of almonds changed as a result of a change in the supply of almonds, is the demand for almonds elastic or inelastic? Explain your an-swer
What will be an ideal response?
The total revenue test indicates that the demand for almonds is elastic. The increase in the supply of almonds lowers the price but in-creases the total revenue. The total revenue test demonstrates that this outcome—the price and total revenue change in opposite directions—occurs when the demand is elastic.
You might also like to view...
Refer to the figure above. If the supply curve for flash drives shifts from S1 to S2, with no change in the demand curve, the new competitive equilibrium price is:
A) $3. B) $4. C) $5. D) $7.
The primary difference between a change in supply and a change in the quantity supplied is:
A) a change in quantity supplied is a shift in the supply curve, and a change in supply is a movement along the supply curve. B) both a change in quantity supplied and a change in supply are movements along the supply curve, only in different directions. C) a change in quantity supplied is a movement along the supply curve, and a change in supply is a shift of the supply curve. D) a change in supply is a movement to the left along the supply curve and a change in quantity supplied is a movement to the right along the supply curve.