1. Demand is _________ on the upper portion of a linear demand curve and _________ on the lower portion of a linear demand curve. 2. If Maria spends a fixed dollar amount per week on movie rentals...

1. Demand is _________ on the upper portion of a linear demand curve and _________ on the lower portion of a linear demand curve.

2. If Maria spends a fixed dollar amount per week on movie rentals regardless of changes in the price, Maria’s demand for movie rentals can be considered _________ (elastic/unit elastic/inelastic).

3.At the midpoint of a linear demand curve, the price elasticity of demand is _________.

4. If we are on the lower part of a linear demand curve, a decrease in price _________ (increases/decreases) total revenue.

5. Suppose that the elasticity of demand for a product is 0.50. If a firm producing this product increases the price, its total revenue will _________ (increase/ decrease/stay the same).