Supply and Demand Analysis in Microeconomics Quiz

Test your knowledge on demand, supply curves, elasticity, equilibrium, subsidies & more with our Microeconomics quiz!

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Which of the following best describes the law of demand?

As the price of a good increases, the quantity demanded decreases.

As the price of a good decreases, the quantity demanded increases.

As the price of a good increases, the quantity demanded increases.

As the price of a good decreases, the quantity demanded decreases.

What does the supply curve illustrate?

The relationship between price and quantity demanded.

The relationship between price and quantity supplied.

The relationship between price and consumer income.

The relationship between price and consumer preferences.

What happens to equilibrium price and quantity when demand increases and supply decreases?

Equilibrium price decreases, equilibrium quantity decreases.

Equilibrium price increases, equilibrium quantity increases.

Equilibrium price increases, equilibrium quantity decreases.

Equilibrium price decreases, equilibrium quantity increases.

Which of the following factors does NOT cause a shift in the demand curve?

Change in consumer income.

Change in the price of substitutes.

Change in consumer tastes and preferences.

Change in the price of the good itself.

What does the term 'price elasticity of demand' measure?

The percentage change in quantity demanded for a percentage change in price.

The percentage change in price for a percentage change in quantity demanded.

The percentage change in quantity demanded for a percentage change in income.

The percentage change in price for a percentage change in income.

If the cross-price elasticity of demand between two goods is negative, what does it indicate?

The goods are substitutes.

The goods are complements.

There is no relationship between the goods.

The goods are inferior.

What does the income elasticity of demand measure?

The percentage change in quantity demanded for a percentage change in income.

The percentage change in income for a percentage change in quantity demanded.

The percentage change in price for a percentage change in income.

The percentage change in quantity demanded for a percentage change in price.

What is the concept of elasticity of supply?

It measures the responsiveness of quantity demanded to a change in price.

It measures the responsiveness of quantity supplied to a change in price.

It measures the responsiveness of quantity demanded to a change in income.

It measures the responsiveness of quantity supplied to a change in income.

What is the main determinant of the price elasticity of supply?

Time period considered.

Availability of resources.

Price level.

Producer surplus.

#10

What happens to equilibrium price and quantity if both demand and supply increase by the same proportion?

Equilibrium price increases, equilibrium quantity decreases.

Equilibrium price decreases, equilibrium quantity increases.

Equilibrium price decreases, equilibrium quantity remains the same.

Equilibrium price remains the same, equilibrium quantity increases.

#11

If a good has a perfectly inelastic demand, what is the price elasticity of demand?

Zero

Greater than 1

Less than 1

Infinity

#12

What does it mean when demand is said to be elastic?

Consumers are not very responsive to price changes.

Consumers are highly responsive to price changes.

Consumers do not respond to price changes at all.

Consumers respond to income changes more than price changes.

Supply and Demand Analysis in Microeconomics Quiz

Which of the following best describes the law of demand?

What does the supply curve illustrate?

What happens to equilibrium price and quantity when demand increases and supply decreases?

Which of the following factors does NOT cause a shift in the demand curve?

What does the term 'price elasticity of demand' measure?

If the cross-price elasticity of demand between two goods is negative, what does it indicate?

What does the income elasticity of demand measure?

What is the concept of elasticity of supply?

What is the main determinant of the price elasticity of supply?

What happens to equilibrium price and quantity if both demand and supply increase by the same proportion?

If a good has a perfectly inelastic demand, what is the price elasticity of demand?

What does it mean when demand is said to be elastic?

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