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1. A 10 % increase in the price of soda leads to a 20 % increase in the quantity of iced tea demanded. It appears that:
a. elasticity of demand for soda 0.5 and is inelastic.
b. elasticity of demand for iced tea is 2 and is elastic.
c. cross-price elasticity of demand for soda is -0.5.
d. cross-price elasticity of demand for iced tea is -2.
2. When economists are sketching examples of a demand or supply curve that is close to horizontal, they refer to that demand or supply curve as ____________.
a. elastic
b. inelastic
c. price inelasticity
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