Demand, supply and price

Written by Dr. Ahmed Raza (Economics)

گیارہویں جماعت · Economics · 12 سوالات

نام: ____________________ تاریخ: ____________

The law of demand says that, other things being equal, a rise in price:
- A Shifts the supply curve
- B Does not affect demand
- C Raises the quantity demanded
- D Lowers the quantity demanded
A rise in the price of tea is likely to:
- A Have no effect on coffee
- B Lower the demand for coffee
- C Lower the supply of coffee
- D Raise the demand for coffee
A fall in the price of a good itself causes:
- A A shift of the supply curve
- B A movement along the demand curve
- C A shift of the demand curve to the left
- D No change
The law of supply says that a higher price leads to:
- A A larger quantity supplied
- B A smaller quantity supplied
- C A lower cost
- D No change in supply
At the equilibrium price:
- A Quantity demanded equals quantity supplied
- B There is a shortage
- C The government fixes the price
- D There is a surplus
If the price is above the equilibrium price, there is a:
- A Surplus
- B Tax
- C Balance
- D Shortage
An increase in income raises the demand for a:
- A Free good
- B Normal good
- C Inferior good
- D Public good only
A subsidy to producers shifts the supply curve:
- A To the right
- B It does not shift
- C To the left
- D Downward only
Price elasticity of demand is calculated as:
- A % change in price / % change in quantity demanded
- B % change in quantity demanded / % change in price
- C Price x quantity
- D Change in income / change in price
If the price elasticity of demand is 0.5 in size, demand is:
- A Unitary elastic
- B Inelastic
- C Elastic
- D Perfectly elastic
Which of these usually has the most inelastic demand?
- A Salt
- B Luxury cars
- C Branded watches
- D Holiday tours
A tax on producers shifts the supply curve:
- A To the right
- B It does not shift
- C To the left
- D Upward only

جوابی کلید

1. D, 2. D, 3. B, 4. A, 5. A, 6. A, 7. B, 8. A, 9. B, 10. B, 11. A, 12. C

The demand curve slopes downward.
Tea and coffee are substitutes.
Only the quantity demanded changes.
The supply curve slopes upward.
The market clears.
Sellers offer more than buyers want, so the price tends to fall.
By definition, demand for a normal good rises with income.
Costs fall, so supply rises.
It measures the response of quantity to price.
A value below 1 means inelastic.
Salt is a necessity with no close substitute.
Costs rise, so supply falls.