10pts! To first person to answer these correctly. No Guessing! Microeconomics?

Question

1. The price elasticity of demand for widgets is .80. Assuming no change in the demand curve for widgets, a 16% increase in sales implies a:

A) 1% reduction in price.

B) 12% reduction in price.

C) 40% reduction in price.

D) 20% reduction in price.

2. Suppose Alex's Pizzeria currently faces a linear demand curve and is charging a very high price per pizza and doing very little business. Alex now decides to lower pizza prices by 5% per week for an indefinite period of time. We can expect that each successive week:

A) demand will become more price elastic.

B) price elasticity of demand will not change as price is lowered.

C) demand will become less price elastic.

D) the elasticity of supply will increase.

The price elasticity of demand of a straight-line demand curve is:

A) elastic in high-price ranes and inelastic on low-price ranges.

B) price elasticity of demand will not change as price is lowered.

C) demand will become less price elastic.

D) the elasticity of supply will increase.

Answer 1

do your own homework..

Answer 2

1 - "D"

2 - "C"

3 - "A"