Question # 1

Which one is increasing function of price

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demand

utility

supply

consumption

Other things remaining the same, quantity supplied of a commodity increases with rise in price and decreases with fall in price are called

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Law of Supply

Law of Demand

Law of equilibrium

None of these

The demand for a product is inelastic. In order to increase government revenue, the finance minister will :

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Lower down the tax rate

Increase the tax rate

Not change the tax rate

Double the tax rate

Long period supply curve is

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relatively flatter

relatively steeper

more elastic

a and c of above

The quantities of a commodity offered for sale at different prices during a given period of time are called

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Supply

Demand

Stock

None of these

If a firm makes 200 units of a good available at a price of Rs. 10 per unit, the elasticity is

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0.05

10

20

indeterminate

If elasticity of supply is greater than one. supply curve will be

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horizontal

vertical

passing through origin

touching y-axis

When a supply of a commodity increases without change in price it is called

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fall in supply

expansion in supply

contraction in supply in

rise in supply

In May 2012, firm was supplying 1000 kg of sugar at market price of Rs. 60/- per kg. During June 2012, firm's supply of sugar had decreased to 900 kg at price Rs. 40/- per kg. These changes show that supply of sugar is

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Perfectly elastic

Perfectly inelastic

Less elastic

More elastic

A schedule of the amount of a good that would be offered for sale at all possible prices, at any one instant of time or during any period of time are called

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Supply

Demand

Stock

None of these

The method to measure the elasticity of demand is :

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Percentage method

Total outlay approach

Geometric approch

All the three

Elasticity of a demand for product will be greater then unity if, with a fall in its price, total expenditure of consumer.

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Increase

Falls

Remains the same

None of the three

Which of the following shifts supply curve of cars to the right

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tax on new cars

increase in wages of workers

decrease in steel price

a successful promotion campaign by sellers

Supply curve

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is vertical in long run

is flatter in long run

is same in long and short run

is horizontal in both short and long run

In case of perfectly elastic demand curve, the demand curve will be parallel to the :

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Horizontal axis

Vertical Axis

None of the above

Which one of the following pairs represent complementary demand for a product.

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Tea & coffe

Butter & Margarine

Shirt & shoes

Shirt & trouser

Supply curve will shift when

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price falls

price rises

demand shifts

technology changes

Products A and B are substitutes whereas A and C are complement. With a rise in the price of product A, quantity demand of:

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Product B will go up

Product will fall

Both the above will take place

Nothing will take place

When the percentage change in quantity demanded is greater than the percentage change in price, elasticity of demand for the product will be.

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Equal to unity

Less than unity

Greater than unity

Equal to zero

The price of a product double due to which its quantity demand falls to one half. The elasticity of demand for product will be:

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Equal to unity

Lass than unity

Greater than unity

Equal to zero

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