SOLVED

11) The fact that there is a very limited amount of land in Hong Kong means the supply of new apartments in Hong Kong is A) inelastic. B) elastic. C) unit elastic. D) perfectly elastic. E) limited by the demand. 12) The opportunity cost of producing a good rises only slightly as the quantity produced increases. This good has A) an inelastic demand. B) an elastic demand. C) an elastic supply. D) an inelastic supply. E) a perfectly elastic supply. 13) For a product with a constant or gently increasing opportunity cost of producing additional units, as more is produced, we expect that A) demand is price elastic. B) supply is price elastic. C) demand is price inelastic. D) supply is price inelastic. E) demand is unit elastic. 14) For which of the following would the supply likely be most inelastic? A) aircraft carrier B) canned soup C) toy airplane D) t-shirt E) bottled water 15) Suppose a good can be produced using commonly available resources. The elasticity of supply is A) negative. B) greater than zero but less than 1. C) greater than 1. D) zero. E) More information is needed to make a determination about the size of the elasticity of supply. 16) If wheat can be produced at a constant opportunity cost, then the supply of wheat is A) elastic. B) inelastic. C) unit elastic. D) perfectly inelastic. E) perfectly elastic. 17) Which of the following explains why supply is more elastic as more time passes? A) It is difficult or impossible to increase the quantity produced in a short period of time. B) Consumers have more time to search for substitutes. C) Sellers try to take advantage of a high price in the short term. D) The supply curve becomes generally steeper as more time passes. E) There is no explanation for this phenomenon. 18) One reason why the price elasticity of supply for DVD players is greater than one is that A) the cost of producing DVD players is small. B) the storage of DVD players is not possible. C) DVD players can be easily stored. D) the demand for DVD players is fairly large. E) DVD players require relatively advanced technology for their production. 19) If the price elasticity of supply for a good is 0.75, then A) the percentage change in the quantity supplied is less than the percentage change in price. B) the supply is elastic. C) an increase in the price boosts the quantity supplied by a larger percentage. D) the supply is inelastic so the demand must also be inelastic. E) None of the above answers is correct. 20) It is very difficult for Gourmet Chocolatier to find inexpensive and available inputs for the business. Because of this, we predict that Gourmet Chocolatier’s supply to be A) inelastic. B) perfectly elastic. C) elastic. D) unit elastic. E) nonexistent.