#1
2. Which of the following is a determinant of demand?
Price of substitutes
Number of producers
Cost of production
Government regulations
#2
7. In a market characterized by perfect competition, what is true about the price of a good?
Set by the government
Determined by the market forces
Controlled by a single producer
Constant over time
#3
14. What is the main factor influencing the price elasticity of demand for a good?
Substitutability
Government regulations
Production costs
Market competition
#4
20. What is the key characteristic of a perfectly competitive market?
Few sellers with differentiated products
Single seller with significant market power
Many sellers with identical products
High barriers to entry
#5
1. What happens to the equilibrium price and quantity when demand increases and supply remains constant?
Price and quantity both increase
Price increases, quantity decreases
Price decreases, quantity increases
Price remains constant, quantity increases
#6
4. What is the price elasticity of demand if the absolute value is greater than 1?
Perfectly elastic
Inelastic
Elastic
Unitary elastic
#7
6. What is the main factor that influences the elasticity of supply?
Time
Price
Income
Consumer preferences
#8
9. How does a decrease in the price of complementary goods affect the demand for a product?
Increases demand
Decreases demand
No effect on demand
Increases supply
#9
12. In the long run, what happens to supply in response to an increase in demand?
Stays constant
Decreases
Increases
Becomes perfectly elastic
#10
3. In the law of supply, what does the term 'ceteris paribus' mean?
All else being equal
Supply and demand are equal
Constant increase in supply
Demand is constant
#11
5. How does a price ceiling affect the market for a good?
Causes a surplus
Causes a shortage
Leads to equilibrium
Has no impact
#12
8. What is the concept of a 'Giffen good' in economics?
A luxury item
An inferior good with an upward-sloping demand curve
A normal good with an inelastic demand
A substitute for another good
#13
10. What is the relationship between the price and quantity demanded in a perfectly elastic demand curve?
No relationship
Directly proportional
Inversely proportional
Constant quantity demanded
#14
11. What is the concept of 'deadweight loss' in the context of supply and demand?
Loss in producer surplus
Loss in consumer surplus
Loss of government revenue
Loss of total surplus