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Question 1An increase in the price of a complement will result in a(n) __________ for the product.A. decrease in the quantity demandedB. increase in the quantity demandedC. decrease in the demandD. increase in the demandQuestion 2If coffee is a substitute for tea and the price of coffee rises what will happen?A. Demand for tea will decrease.B. Demand for tea will increase.C. The quantity demanded of coffee will rise.D. The quantity demanded of tea will decrease.Question 3The most important determinant of the degree of elasticity of demand is:A. whether or not the item is a big ticket item.B. whether or not the item is a luxury or not.C. how many uses the product has.D. the availability of substitutes.Question 4If a car dealership decides to offer a rebate to reduce the selling price of its cars and as a result finds an increase in its total revenues then the demand for cars from this dealership is:A. price elastic.B. price inelastic.C. rebate inelastic.D. unit elastic.

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