#1
Which of the following represents the law of demand?
As price increases, quantity demanded decreases.
As price increases, quantity demanded increases.
As price decreases, quantity demanded increases.
As price decreases, quantity demanded decreases.
#2
What happens to equilibrium price and quantity when there is an increase in demand?
Equilibrium price increases; equilibrium quantity decreases.
Equilibrium price increases; equilibrium quantity increases.
Equilibrium price decreases; equilibrium quantity decreases.
Equilibrium price decreases; equilibrium quantity increases.
#3
Which of the following is likely to result in a decrease in demand for oranges?
A decrease in the price of oranges.
A decrease in the price of apples (a substitute).
A decrease in consumer income.
A decrease in the price of orange juice (a complement).
#4
Which of the following is likely to result in an increase in demand for coffee?
A decrease in the price of tea (a substitute).
A decrease in consumer income.
An increase in the price of sugar (a complement).
An increase in the price of coffee makers.
#5
Which of the following is likely to result in a decrease in demand for laptops?
A decrease in the price of tablets (a substitute).
A decrease in consumer income.
An increase in the price of software (a complement).
An increase in the price of laptops.
#6
Which of the following is likely to result in an increase in demand for bicycles?
A decrease in the price of cars (a substitute).
A decrease in consumer income.
An increase in the price of gasoline.
An increase in the price of bicycles.
#7
What is the result when there is a surplus in the market?
Excess demand
Excess supply
Perfect competition
Monopoly
#8
Which factor would not cause a shift in the supply curve?
Change in technology
Change in production costs
Change in consumer preferences
Change in the number of sellers
#9
What is the effect of a price ceiling set below the equilibrium price?
Creates a surplus.
Creates a shortage.
Leads to a decrease in quantity supplied.
Leads to an increase in quantity demanded.
#10
What would cause a movement along the supply curve?
Change in consumer income.
Change in production technology.
Change in input prices.
Change in government regulations.
#11
What is the effect of a price floor set above the equilibrium price?
Creates a surplus.
Creates a shortage.
Leads to a decrease in quantity supplied.
Leads to an increase in quantity demanded.
#12
What would cause a shift of the demand curve?
Change in consumer income.
Change in production technology.
Change in input prices.
Change in government regulations.
#13
What is consumer surplus?
The difference between the price consumers are willing to pay and the price they actually pay.
The difference between the quantity supplied and the quantity demanded at the market price.
The difference between the price producers are willing to accept and the price they actually receive.
The difference between the quantity demanded and the quantity supplied at the market price.
#14
What does the price elasticity of demand measure?
The responsiveness of quantity demanded to a change in price.
The responsiveness of quantity supplied to a change in price.
The percentage change in quantity demanded.
The percentage change in price.
#15
In the long run, how is the price elasticity of supply likely to change?
It becomes more elastic.
It becomes less elastic.
It remains constant.
It is unaffected by time.
#16
What does the price elasticity of supply measure?
The responsiveness of quantity demanded to a change in price.
The responsiveness of quantity supplied to a change in price.
The percentage change in quantity demanded.
The percentage change in price.
#17
In the long run, how is the price elasticity of demand likely to change?
It becomes more elastic.
It becomes less elastic.
It remains constant.
It is unaffected by time.
#18
What is the primary determinant of the price elasticity of demand?
Availability of substitutes.
Consumer income.
Price level.
Time.