Pearson Edexcel IGCSE · Economics

Elasticity: Practice Questions

5 multiple-choice questions marked as you go, and 4 written questions with worked solutions. All on Elasticity.

9 questions20 marksFree, no account

Question 1

1 mark

Which of the following factors is most likely to make the Price Elasticity of Supply (PES) for a manufactured good more elastic?

Question 2

1 mark

The government decides to increase the indirect tax on a product. The product has a Price Elasticity of Demand (PED) of \( 0.3 \) and a Price Elasticity of Supply (PES) of \( 1.4 \). What is the most likely impact of this tax?

Question 3

1 mark

A company faces a demand curve that is price inelastic. If the company decides to decrease the price of its product, what will be the most likely effect on its total revenue?

Question 4

1 mark

A manufacturing firm has high levels of spare capacity and maintains significant stocks of finished products. Which of the following numerical values for the Price Elasticity of Supply (PES) is most likely for this firm's product?

Question 5

1 mark

If a \( 5\% \) increase in consumer income leads to a \( 10\% \) increase in the quantity demanded for a specific brand of smartphone, what is the Income Elasticity of Demand (YED) and how is the good classified?

Question 6

2 marks

If a product has an income elasticity of demand (YED) of \( -0.8 \), identify the category of good it belongs to and state the reason for your choice.

Write your answer out first, then check it against the worked solution.

Question 7

4 marks

A business increases the price of its product by \( 10\% \), which leads to a \( 25\% \) decrease in the quantity demanded. Calculate the Price Elasticity of Demand (PED) and state whether the firm's total revenue will increase or decrease as a result of this price change.

Write your answer out first, then check it against the worked solution.

Question 8

5 marks

Explain why the Price Elasticity of Supply (PES) for primary products, such as copper or wheat, tends to be more inelastic in the short run compared to manufactured goods.

Write your answer out first, then check it against the worked solution.

Question 9

4 marks

The responsiveness of supply to price changes is measured by the Price Elasticity of Supply (PES).
(a) Calculate the PES for a crop if the price rises by \( 20\% \) and the quantity supplied increases by \( 5\% \).
(b) Explain one reason why the supply of agricultural products tends to be price inelastic in the short run.

Write your answer out first, then check it against the worked solution.

* The content provided by thinka is generated by AI and may not always be accurate or up-to-date. Please use it as a supplementary resource and verify with official materials.

You've seen the model answer. Now get yours marked.

This page can show you how a good answer looks. It cannot tell you what your answer was missing. thinka marks your written work against the real mark scheme in about 15 seconds.

Get My Answers Marked Back to the notes

Want more questions like these? Get a fresh set on this topic, graded as you go.

Practice More