Table 52 -Refer to Table 5

question 38

Multiple Choice

Table 5.2
$\begin{array}{c}\begin{array}{lll}\\ \text {Old}\\ \text {New}\end{array}\begin{array}{lll}\text {Quantity}\\\hline 20\\10\end{array}\begin{array}{lll}\text{ Price}\\\hline \$ 40 \\ \$ 60 \end{array}\end{array}$


-Refer to Table 5.2,which shows the price and quantity combinations for a product.The demand for the good is _____,and an increase in the price of the product from $40 to $60 per unit will _____ total revenue.

• A)unit elastic; increase
• B)elastic; decrease
• C)unit elastic; not change
• D)inelastic; increase.
• E)elastic; decrease.

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Definitions:

Depletable Resource

A natural resource that can be diminished or exhausted by use, such as fossil fuels, minerals, or forests.

Extraction Cost

The expenses associated with the removal of raw materials from their natural setting for use or sale.

Non-Monetary Benefits

Advantages or perks associated with a job or situation that are not in the form of money, such as health insurance or flexible working hours.

Hotelling Rule

A theory in economics that states the net price (price minus extraction costs) of a non-renewable resource should increase at the rate of interest over time.