Demand & Supply - Quiz for UPSC, SSC, Bank, Railways & Govt Exams

What is the law of demand?

As price increases, quantity demanded increases

As price increases, quantity demanded decreases

As price decreases, quantity demanded increases

As price decreases, quantity demanded decreases

Correct Answer: 4

Which of the following factors does not affect demand?

Price of substitutes

Consumer income

Price of the product

Number of producers

Correct Answer: 4

If the demand for a product is elastic, what happens to quantity demanded when price decreases?

Quantity demanded increases by a large percentage

Quantity demanded increases by a small percentage

Quantity demanded decreases by a large percentage

Quantity demanded remains unchanged

Correct Answer: 1

What does the law of supply state?

As price increases, quantity supplied increases

As price increases, quantity supplied decreases

As price decreases, quantity supplied increases

As price decreases, quantity supplied decreases

Correct Answer: 1

Which factor does not affect supply?

Technology

Cost of production

Price of the product

Consumer preferences

Correct Answer: 4

If the supply of a product is perfectly elastic, what happens to quantity supplied when price increases?

Quantity supplied increases by a large percentage

Quantity supplied increases by a small percentage

Quantity supplied decreases by a large percentage

Quantity supplied remains unchanged

Correct Answer: 4

What is the equilibrium price?

The price where quantity demanded equals quantity supplied

The highest price in the market

The lowest price in the market

The price set by the government

Correct Answer: 1

Which of the following is not a determinant of price elasticity of demand?

Availability of substitutes

Proportion of income spent on the product

Time period

Consumer preferences

Correct Answer: 4

When demand is inelastic, what happens to total revenue when price decreases?

Total revenue increases

Total revenue decreases

Total revenue remains unchanged

Total revenue cannot be determined

Correct Answer: 3

Which of the following is a determinant of price elasticity of supply?

Number of buyers

Time period

Availability of complements

Consumer income

Correct Answer: 2

The demand elasticity turns out to be _____when the product price comes down by 10% and the demand for the product goes up by 30%.

3

30

13

10

Correct Answer: 3

The demand for commodity turns out to be ____ when the demanded quantity of commodity does not respond to change in its prices.

inelastic

unit elastic

elastic

perfectly inelastic

Correct Answer: 4

Which one out of the mentioned options is not a cause of change or shift in demand for any product?

when the substitute price is changed

when there is a change in product price

when a change in consumer income is seen

none of these

Correct Answer: 2

When for a commodity, the elasticity of demand is low, the product______?

Is a necessity

is a luxury

is a little important in overall budget

none of these

Correct Answer: 1

A price increase price will result in_____ when the product demand is perfectly inelastic.

a rise in total income from a certain product

a downfall in the demanded quantity of product

no changes in total income from a certain product

a reduction in total income from a certain product

Correct Answer: 1

When the total revenue from product and the price moves in the same direction, then the demand is________.

elastic

perfectly elastic

unrelated

inelastic

Correct Answer: 4

The supply curve will be_____ when the supply elasticity is greater than one.

horizontal

vertical

touching y-axis

passing through the origin?

Correct Answer: 3

Can an increase in demand for certain products make the supply curve shift in any direction?

the curve will move in the right direction

no effect on the supply

A change in the slope of a supply curve

the curve will move in the left direction

Correct Answer: 2

We can see the upward slope of a firm supply curve due to____.

consumers see a positive relationship between the quantity and price

the production expansion leads to the use of inferior inputs

the cost of production of extra units of output will rise beyond a point

none of these

Correct Answer: 3

Without changing the price_____ moves to a rise in commodity supply.

fall in the supply

decrease in the supply

the rise in the supply

expansion in the supply?

Correct Answer: 3

In a certain year, the workers experienced bad weather. If the rest of the factors remain the same, the supply curve of that product will move in which direction?

leftward

upward?

rightward

none of these?

Correct Answer: 1

If the supply curve of the market moves to the right side, which of these will explain the shift at best?

making a commodity production at low cost by introducing a new technique

increase in the raw material rate

government introducing a tax on that certain product

none of? the above?

Correct Answer: 1

Out of these scenarios, which one will not change the curve of demand for a certain product?

when we see a reduction in the amount of raw material of that thing or product

when a study says, the product is not good for health??

when we see another campaign for goods

change in consumers? income

Correct Answer: 1

Out of these scenarios, which won?t lead to a demand change for the product?

a switch in consumer taste?

increase in consumer income

changes in the price

none of these

Correct Answer: 4

In July 2012, a company was giving 6000kgs of flour at the market value of rupee 40 per kg. But in august 2012, the flour supply was reduced to 5500 kg at the market value of rupee 30kg. This change in flour supply is_____.

less elastic

more elastic

perfectly elastic

perfectly inelastic

Correct Answer: 1

The demand curve that?s horizontal and parallel to the x-axis shows the elasticity of demand to be____.

infinite?

zero

greater than zero

equals to one?

Correct Answer: 1

Which of these doesn?t lead to a change in the demand curve?

price of product

income

An increase in income in the countries that are developing leads the curve of demand shift to _____.

up

down

left

right

Correct Answer: 4

Mention the responsible factor in demand for any natural resource?

increase in human population

scientific advancement

environmental pollution

use of biodegradable resources

Correct Answer: 1

Name a phenomenon in which the consumer tends to be exclusive and different by asking for less commodity as many of the people consume the same.?

substitution effect

price effect

bandwagon effect

snob effect

Correct Answer: 4

When the demanded goods quality is equal to supplied good?s quantity, then____.

when you see a shortage

when you see a surplus

when you see the government is investing in the market

none of these

Correct Answer: 4

The shape of the demand curve is_____.

downward sloping

upward-sloping

vertical

horizontal

Correct Answer: 1

When the restaurant that serves fast food increases in the number, this leads to_____.

An increase in fast-food meal supply

the growth in fast-food meal demand

a growth is seen in the demand for substitutes for such meals

increase in the rate of such meals

Correct Answer: 1

Many of the supply curve____ due to increases in marginal cost.

is vertical

is horizontal

has a positive slope

has a negative slope

Correct Answer: 3

When one moves up with the supply curve, which one of these metrics is not a part of the constant factor?

the seller numbers

the commodity prices

expected prices in the future

the resources cost that was used for commodity production

Correct Answer: 2

What will be the supply when the price change is by 1%, and the change in supply is by 2%??

indeterminate

elastic

inelastic

static

Correct Answer: 2

What will happen if the rate of complementary goods has a downfall or there?s an increase in consumer income?

the products demand curve shifts towards the right?

the products supply curve shifts toward the right?

the products demand curve shifts towards the right?

Correct Answer: 4

While we draw the demand curve, which of these assumptions are there?

the substitute price should not change

the curve for demand should be linear

there should be no change in commodity price

the demanded quantity does not change

Correct Answer: 1

The relation of ______ is by the law of demand.

the quantity and price of commodity?

the price and income of commodity

demand quantity and demand-supply of commodity

income and demand quantity of a commodity

Correct Answer: 1

The price elasticity of demand will increase with the length of the period to which the demand vurve pertains because

consumers' incomes will increase.

the demand curve will shift outward.

all prices will increase over time.

consumers will be better able to find substitutes.

Correct Answer: 4

If demand for farm crops is inelastic, a good harvest will cause farm revenues to:

increase because of the increase in the quantity that farmers can sell.

increase because of a downward movement along the supply curve, encouraging an increase in demand

decrease because of a percentage fall in price greater than the percentage increase in quantity sold

remain unchanged, because the increase in quantity that can be sold will be matched by an equal decrease in price

Correct Answer: 3

A state government wants to increase the taxes on cigarettes to increase tax revenue.This tax would only be effective in raising new revenues if the price elasticity of demand is

unity.

elastic.

inelastic.

perfectly elastic.

Correct Answer: 3

Sony is considering a 10 percent price reduction on its color television sets. If the demand for sets in this price range is inelastic

revenues from color sets will remain constant.

revenues derived from color sets will decrease.

revenues derived from color sets will increase.

the number of television sets sold will decrease.

Correct Answer: 2

The price elasticity of demand for a textbook is estimated to be 1 no matter what the price or quantity demanded in this case

a 10 percent increase in price will result in a 10 percent increase in the quantity demanded

a 10 percent increase in price will result in a 10 percent decrease in the quantity demanded

an increase in price will decrease the total revenue of sellers.

a decrease in price will increase the total revenue of sellers.

Correct Answer: 2

To economists the main differences between "the short run" and "the long run" are that

the law of diminishing returns applies in the long run, but not in the short run.

in the short run all resources are fixed, while in the long run all resources are variable

in the long run all resources are variable, while in the short run at least one resource is fixed

fixed costs are more important to decision making in the long run than they are in the short run

Correct Answer: 3

Cross elasticity of demand is:

negative for complementary goods.

negative for substitute goods

unitary for inferior goods.

positive for inferior goods.

Correct Answer: 1

A positive cross elasticity of demand coefficient indicates that:

a product is an inferior good.

a product is a normal good.

two products are substitute goods.

two products are complementary goods.

Correct Answer: 3

A 3 percent increase in the price of tea causes a 6 percent increase in the demand for coffe .The cross elasticity of demand for coffe with respect to the price of tea is

-0.5.

+0.5.

-2.0.

+2.0.

Correct Answer: 4

For which product is the income elasticity of demand most likely to be negative?

computer software

used clothing

basketballs

bread

Correct Answer: 2

The income elasticity of demand for jewelry is 2. Other things equal, a 10 percent increase in consumer income will

decrease the quantity of jewelry purchased by 20 percent.

increase the quantity of jewelry purchased by 10 percent.

decrease the quantity of jewelry purchased by 10 percent.

increase the quantity of jewelry purchased by 20 percent.

Correct Answer: 4

In the context of demand elasticity, what does a price elasticity coefficient of -1.5 indicate about the nature of the demand for a good?

Perfectly elastic demand

Unit elastic demand

Inelastic demand

Elastic demand

Correct Answer: 4

Which type of goods is characterized by a positive cross-price elasticity of demand, meaning that an increase in the price of one good leads to an increase in the demand for the other?

Inferior goods

Complementary goods

Normal goods

Substitute goods

Correct Answer: 4

What is the term used to describe the situation when the supply curve shifts to the right due to technological advancements in production?

Increase in quantity supplied

Decrease in supply

Increase in supply

Decrease in quantity supplied

Correct Answer: 3

Which economic concept explains the observed phenomenon where, despite an increase in price, the quantity supplied increases less than proportionally?

Elasticity of supply

Diminishing returns

Market equilibrium

Price floor

Correct Answer: 1

What is the term for the phenomenon where the quantity demanded for a good increases as the price decreases, leading to a movement along the demand curve rather than a shift in the demand curve?

Change in demand

Change in quantity demanded

Elastic demand

Inelastic demand

Correct Answer: 2

Demand & Supply Quiz - UPSC, SSC, Bank, Railways & Govt Exams

What is the law of demand?

Which of the following factors does not affect demand?

If the demand for a product is elastic, what happens to quantity demanded when price decreases?

What does the law of supply state?

Which factor does not affect supply?

If the supply of a product is perfectly elastic, what happens to quantity supplied when price increases?

What is the equilibrium price?

Which of the following is not a determinant of price elasticity of demand?

When demand is inelastic, what happens to total revenue when price decreases?

Which of the following is a determinant of price elasticity of supply?

The demand elasticity turns out to be _____when the product price comes down by 10% and the demand for the product goes up by 30%.

The demand for commodity turns out to be ____ when the demanded quantity of commodity does not respond to change in its prices.

Which one out of the mentioned options is not a cause of change or shift in demand for any product?

When for a commodity, the elasticity of demand is low, the product______?

A price increase price will result in_____ when the product demand is perfectly inelastic.

When the total revenue from product and the price moves in the same direction, then the demand is________.

The supply curve will be_____ when the supply elasticity is greater than one.

Can an increase in demand for certain products make the supply curve shift in any direction?

We can see the upward slope of a firm supply curve due to____.

Without changing the price_____ moves to a rise in commodity supply.

In a certain year, the workers experienced bad weather. If the rest of the factors remain the same, the supply curve of that product will move in which direction?

If the supply curve of the market moves to the right side, which of these will explain the shift at best?

Out of these scenarios, which one will not change the curve of demand for a certain product?

Out of these scenarios, which won?t lead to a demand change for the product?

In July 2012, a company was giving 6000kgs of flour at the market value of rupee 40 per kg. But in august 2012, the flour supply was reduced to 5500 kg at the market value of rupee 30kg. This change in flour supply is_____.

The demand curve that?s horizontal and parallel to the x-axis shows the elasticity of demand to be____.

Which of these doesn?t lead to a change in the demand curve?

An increase in income in the countries that are developing leads the curve of demand shift to _____.

Mention the responsible factor in demand for any natural resource?

Name a phenomenon in which the consumer tends to be exclusive and different by asking for less commodity as many of the people consume the same.?

When the demanded goods quality is equal to supplied good?s quantity, then____.

The shape of the demand curve is_____.

When the restaurant that serves fast food increases in the number, this leads to_____.

Many of the supply curve____ due to increases in marginal cost.

When one moves up with the supply curve, which one of these metrics is not a part of the constant factor?

What will be the supply when the price change is by 1%, and the change in supply is by 2%??

What will happen if the rate of complementary goods has a downfall or there?s an increase in consumer income?

While we draw the demand curve, which of these assumptions are there?

The relation of ______ is by the law of demand.

The price elasticity of demand will increase with the length of the period to which the demand vurve pertains because

If demand for farm crops is inelastic, a good harvest will cause farm revenues to:

A state government wants to increase the taxes on cigarettes to increase tax revenue.This tax would only be effective in raising new revenues if the price elasticity of demand is

Sony is considering a 10 percent price reduction on its color television sets. If the demand for sets in this price range is inelastic

The price elasticity of demand for a textbook is estimated to be 1 no matter what the price or quantity demanded in this case

To economists the main differences between "the short run" and "the long run" are that

Cross elasticity of demand is:

A positive cross elasticity of demand coefficient indicates that:

A 3 percent increase in the price of tea causes a 6 percent increase in the demand for coffe .The cross elasticity of demand for coffe with respect to the price of tea is

For which product is the income elasticity of demand most likely to be negative?

The income elasticity of demand for jewelry is 2. Other things equal, a 10 percent increase in consumer income will

In the context of demand elasticity, what does a price elasticity coefficient of -1.5 indicate about the nature of the demand for a good?

Which type of goods is characterized by a positive cross-price elasticity of demand, meaning that an increase in the price of one good leads to an increase in the demand for the other?

What is the term used to describe the situation when the supply curve shifts to the right due to technological advancements in production?

Which economic concept explains the observed phenomenon where, despite an increase in price, the quantity supplied increases less than proportionally?

What is the term for the phenomenon where the quantity demanded for a good increases as the price decreases, leading to a movement along the demand curve rather than a shift in the demand curve?