Market Equilibrium and Influencing Factors Quiz
Test your knowledge of microeconomics with questions on market equilibrium, supply, demand, price controls, elasticity, and more.
#1
What is market equilibrium?
A state where demand exceeds supply
A state where supply exceeds demand
A state of balance where demand equals supply
A state with no buyers or sellers
#2
In the context of market equilibrium, what is elasticity of demand?
The slope of the demand curve
The responsiveness of quantity demanded to a change in price
The total demand in the market
The percentage change in quantity demanded
#3
What is the price elasticity of supply?
The responsiveness of quantity supplied to a change in price
The slope of the supply curve
The total supply in the market
The percentage change in quantity demanded
#4
What is the Laffer curve used to illustrate?
The relationship between tax rates and tax revenue
The demand and supply of luxury goods
The impact of inflation on consumer spending
The elasticity of demand for basic necessities
#5
What is the Law of Diminishing Marginal Returns?
As production increases, marginal returns also increase
As production increases, marginal returns decrease
As production decreases, marginal returns increase
As production decreases, marginal returns also decrease
#6
Which of the following can shift the demand curve for a product?
Change in the price of the product
Change in consumer income
Change in the cost of production
Change in the number of sellers
#7
What is the Law of Supply?
As price increases, quantity supplied increases
As price increases, quantity supplied decreases
There is no relationship between price and quantity supplied
Quantity supplied is constant at all prices
#8
What is a black market?
A market where illegal goods are traded
A market with only black-colored products
A market without government regulation
A market with low demand
#9
How does a decrease in the price of a substitute affect the demand for a product?
Increases the demand
Decreases the demand
No effect on the demand
Increases the supply
#10
What is the Cobb-Douglas production function used to represent?
Supply and demand equilibrium
Cost minimization in production
The relationship between input factors and output
Consumer preferences
#11
If the government imposes a price ceiling below the equilibrium price, what is likely to happen?
Excess demand or a shortage
Excess supply or surplus
No impact on the market
Equilibrium will be maintained
#12
What is a non-price determinant of supply?
Change in the price of the product
Change in consumer preferences
Change in the number of buyers
Change in technology used in production
#13
What is the income effect in economics?
The change in quantity demanded due to a change in income
The change in income due to a change in quantity demanded
The change in price due to a change in income
The change in quantity supplied due to a change in income
#14
What is a Giffen good?
A normal good with elastic demand
An inferior good with inelastic demand
A luxury good with elastic demand
A special type of public good
#15
What is the concept of consumer surplus?
The amount of money consumers save during a sale
The difference between what consumers are willing to pay and what they actually pay
The additional quantity of a good that consumers demand
The total revenue generated by consumers
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