Market Equilibrium and Supply-Demand Analysis Quiz

Test your knowledge on market equilibrium, supply-demand analysis, elasticity, subsidies, and more with these microeconomics quiz questions.

Practice Learn Test

What is market equilibrium?

When supply exceeds demand

When demand exceeds supply

When supply equals demand

When supply and demand are unrelated

What happens to price and quantity when there is excess demand in a market?

Price decreases, quantity increases

Price increases, quantity decreases

Price increases, quantity increases

Price decreases, quantity decreases

What is the law of demand?

As price increases, quantity demanded increases

As price decreases, quantity demanded increases

As price increases, quantity demanded decreases

As price decreases, quantity demanded decreases

What does the supply curve represent?

The relationship between price and quantity demanded

The relationship between price and quantity supplied

The relationship between income and quantity demanded

The relationship between price and consumer preferences

What is a subsidy?

A tax imposed on producers

A payment made by the government to producers

A payment made by producers to the government

A price control set by the government

What is the relationship between price and quantity supplied?

Directly proportional

Inversely proportional

No relationship

Varies randomly

What is the effect of an increase in demand on equilibrium price and quantity?

Price and quantity both increase

Price increases, quantity decreases

Price decreases, quantity increases

Price and quantity both decrease

What is a price floor?

A government-imposed maximum price

A government-imposed minimum price

A price set by the market

A price determined by consumer preferences

How does a technological advancement affect market equilibrium?

Increases supply, decreases price

Decreases supply, increases price

Increases supply, increases price

Decreases supply, decreases price

#10

What is a perfectly elastic demand curve?

A demand curve that is vertical

A demand curve that is horizontal

A demand curve that is upward-sloping

A demand curve that is downward-sloping

#11

What factors can cause a shift in the demand curve?

Changes in income and tastes

Changes in price of substitutes

Changes in expectations

All of the above

#12

What is elasticity of demand?

A measure of how much quantity demanded changes with a change in price

A measure of how much quantity supplied changes with a change in price

A measure of how much income changes with a change in price

A measure of how much consumer preferences change with a change in price

#13

What is a price ceiling?

A government-imposed maximum price

A government-imposed minimum price

A price set by the market

A price determined by consumer preferences

#14

What is the difference between a change in quantity demanded and a change in demand?

A change in quantity demanded is caused by a change in price, while a change in demand is caused by a factor other than price

A change in demand is caused by a change in price, while a change in quantity demanded is caused by a factor other than price

A change in quantity demanded and a change in demand are the same thing

A change in quantity demanded is temporary, while a change in demand is permanent

#15

What is a luxury good?

A good for which demand increases as income increases

A good for which demand decreases as income increases

A good for which demand is unaffected by changes in income

A good for which demand is affected by changes in consumer preferences