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Supply & Demand
Supply & Demand
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An economics Quiz to explain the basics of Supply and Demand
Flashcards
25 cards
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Practice quiz
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Questions
25
Answers
1
When we know the quantity of a product that buyers wish to purchase, we know?
excess supply
Supply
excess demand
Demand
2
A floor price of $30 would cause…
a surplus of 400.
a surplus of 150.
a shortage of 400.
a shortage of 150.
3
When a market is in equilibrium
Quantity demanded equals quantity supplied
Excess demand and excess supply are zero
The market is cleared by the equilibrium price
All of the above
4
A demand curve can shift because of changing
tastes
incomes
all of the above
prices of related goods
5
In a competitive market, marginal revenue is equal to which of the following?
Profit
Marginal Utility
Average Cost
Average Variable Cost
6
When the supply curve shifts outwards, what is the effect on equilibrium price and quantity?
Price decreases, quantity increases
Price decreases, quantity decreases
Price increases, quantity increases
Price increases, quantity decreases
7
What do you need to optimize a seller's profit?
Price, Average Cost, and Marginal Revenue
Price, Marginal Revenue, and Average Revenue
Price, Marginal Cost, and Average Cost
Total Variable Costs, Total Fixed Costs, Marginal Cost
8
Which of the following will cause a change in quantity supplied?
A change in the number of firms in the market.
Technological change.
A change in input prices.
A change in the market price of the good.
9
If input prices increase, all else equal
demand will decrease.
quantity supplied will decrease.
supply will increase.
supply will decrease.
10
Supply is the quantity of a good sellers wish to sell each time the market opens
True
False
11
Which of the following could remedy a shortage caused by a price ceiling?
Outward shift of the supply curve
Outward shift of the demand curve
Outward shift of demand and inward shift of supply
Inward shift of the supply curve
12
An increase in price will cause a supply curve to shift to the left
True
False
13
Which of the following is something indifference curves can never do?
Have an upwards slope
Cross
Curve towards the origin
Not curve at all
14
Price ceilings are imposed increase price above the free market equilibrium price
False
True
15
A supply curve is directly affected by
all of the above
input costs
technology
government regulation
16
________ and ________ do not directly affect the demand curve
the price of related goods, preferences
the price of related goods, consumer incomes
the costs of production, bank opening hours
consumer incomes, tastes
17
What do you need to optimize a buyer's utility?
Supply curve and demand curve
Budget constraint and price
Budget constraint and indifference curves
Price and quantity
18
Which of the following would decrease the supply of wheat?
An increase in the price of corn.
none of the above
A decrease in the price of pesticides.
An increase in the demand for wheat.
19
If good A and good B are perfect complements, which combination is the most preferable?
A, 10 B
A, 4 B
A, 3 B
A, 1 B
20
Which of the following would lead to an INCREASE in the demand for golf balls?
A decrease in the cost of producing golf balls.
An increase in household income, they're a normal good
An decrease in the price of golf balls.
none of the above
21
A ceiling price of $15 would cause…
a shortage of 600.
a surplus of 800.
a surplus of 600.
a shortage of 800.
22
The equilibrium price clears the market; it is the price at which ________ _________
b and c
Everything is sold
quantity demanded equals quantity supplied
excess demand is zero
23
If a price increase of good A increases the quantity demanded of good B, then good B is a
inferior good
complementary good
substitute good
bargain
24
An increase in consumer income will increase demand for a ____ but decrease demand for a ____
normal good, complementary good
substitute good, inferior good
normal good, inferior good
inferior good, normal good
25
If the price of a complement increases, all else equal,
quantity demanded will increase.
quantity supplied will increase.
demand will decrease.
demand will increase.
