Question # 1

If price of a commodity constant but its supply increases or price decreases but supply remains constant, it is called

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Rise of supply

Fall of supply

Extension of supply

Contraction of supply

Market price will be determined where

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Supply is more than demand

Demand is more than supply

Demand and supply are equal

Demand is less elastic and supply is more elastic

Finance minister in order to increase the public revenue, imposes tax on the commodities whose demand is less elastic

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At low rate

At high rate

Some times decreases the tax rate and some times increases the tax rate

Does not change tax rate

Quantity supplied of a commodity extends because

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Population changes

Change occurs in assumtions of law of supply

Income of the entrepreneur increases

Price of the commodity increases

Non elastic demand curve is

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positive

negative

vertical

horizontal

If 50% change in demand in response of 30% change in price then:

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Elasticity of demand = 1

Elasticity of demand < 1

Elasticity of demand > 1

Elasticity of demand = 0

Due to fall in demand, curve shifts to

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Right

Left

Both sides

None of these

If demand changes by 10% due to 10% change in price, then elasticity of demand is called

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Equal to unity

More than unity

Less than unity

Infinite

Supply means

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total money of a specific producer

Number of buyers

quantity of goods offered for sale at different prices

purchasing power of quantity supplied

Which one of the following is not included in the assumptions of law of supply

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taste of consumer

cost of production

Methods of production

price of raw material

Demand for Giffen goods is:

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Negative

Vertical

Positive

All of them

Unity method to measure elasticity of supply is presented by

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Adam Smith

Robbins

Marshall

Faruson

If demand does not change, despite a fall in price, is called

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Fall of demand

Rise of demand

Contraction of demand

Extension of demand

One of the following is not substitute good:

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Mobile and charger

Petrol and CNG

Burger and Shawarma

Both b & c

If demand does not change, then due to rise of supply

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Equilibrium price increases

Equilibrium price decreases

Equilibrium price does not change

Equilibrium quantity decreases

If demand falls more proportionately then that of supply then

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Equilibrium price increases

Equilibrium price decreases

Equilibrium price does not change

Equilibrium quantity increases

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Principles of Economics Icom Part 1 English Medium Chapter 3 Online Test MCQs With Answers

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