Market Forces and Price Regulations Quiz

Test your knowledge on market equilibrium, regulations, monopolies, and more. Explore the impact of price controls and government interventions in microeconomics.

#1

What is the basic economic principle that states that as the price of a good or service increases, the quantity demanded for that good or service decreases?

Supply and demand
Law of diminishing returns
Price elasticity of demand
Invisible hand
#2

What is the term used to describe the responsiveness of quantity demanded to a change in price?

Elasticity
Inelasticity
Substitution effect
Utility maximization
#3

What economic term refers to the total quantity of a good or service that consumers are willing and able to purchase at a given price level?

Supply
Demand
Equilibrium
Utility
#4

In a competitive market, what happens to the equilibrium price and quantity when there is an increase in demand?

Equilibrium price increases, quantity increases
Equilibrium price increases, quantity decreases
Equilibrium price decreases, quantity increases
Equilibrium price decreases, quantity decreases
#5

What is a price ceiling in the context of market regulations?

A maximum price set by the government
A minimum price set by the government
A price determined by market forces
A price set by a monopoly
#6

What is the primary goal of antitrust laws in the context of market regulation?

To promote competition and prevent monopolies
To set price controls
To regulate advertising
To control inflation
#7

What is the economic term for the situation where the government intervenes to protect a domestic industry by imposing tariffs or quotas on imported goods?

Free trade
Protectionism
Globalization
Market liberalization
#8

Which of the following is a potential consequence of a price floor in a market?

Surplus of goods
Shortage of goods
Equilibrium price is unaffected
Increase in demand
#9

Which of the following is an example of a non-price barrier to entry in a market?

Taxation
Advertising
Minimum wage laws
Price controls
#10

What economic concept refers to the situation where one firm dominates the entire market and sets the price and quantity of goods or services?

Oligopoly
Monopoly
Perfect competition
Monopolistic competition
#11

In a market with perfect competition, what is the relationship between price and marginal cost in the long run?

Price equals marginal cost
Price is greater than marginal cost
Price is less than marginal cost
Price has no relation to marginal cost
#12

What is the role of a central bank in influencing market forces?

Setting production quotas
Controlling inflation and interest rates
Regulating advertising
Determining minimum wage
#13

In the context of market forces, what is the term for a situation where a single buyer or seller has significant influence over the market price?

Perfect competition
Oligopoly
Monopoly
Monopolistic competition

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