A Shift of the Supply Curve of DVDs Raises the Price

question 148

Multiple Choice

A shift of the supply curve of DVDs raises the price of a DVD from $9.50 to $10.50 and reduces the quantity demanded from 41 million to 39 million DVDs a month. The price elasticity of demand for DVDs is

• A) 0.5.
• B) $2 per 2 million DVDs a month.
• C) 2.0.
• D) 2 million DVDs a month per dollar.

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Definitions:

Domain

The set of all possible input values (typically x values) for which a given function is defined.

Rational Function

A type of function defined by the ratio of two polynomials, where both the numerator and the denominator are polynomials.

Rational Expression

An expression formed by the quotient of two polynomials, resembling a fraction in which both numerator and denominator are polynomials.

Simplify

The process of altering an expression or equation to its most basic form without changing its value.