| 1 |
Demand and supply forces determine market price |
- A. only in perfect competition
- B. only in monopoly market
- C. in both markets
- D. none of the above
|
| 2 |
If price is set above equilibrium level, there will be |
- A. surplus commodity in the market
- B. shortage of commodity in the market
- C. supply curve will shift
- D. demand curve will shift
|
| 3 |
Price of a product is determined in a free market |
- A. by demand for the product
- B. by supply of the product
- C. by both demand and supply
- D. by the government
|
| 4 |
When demand is perfectly elastic, an increase in supply will result in |
- A. decrease in quantity sold
- B. increase in quantity sold
- C. fall in price
- D. b and c above
|
| 5 |
The price and sales of sugar both increase. What could be the cause of this? |
- A. a decrease in the income of the consumers.
- B. a decrease in the tax on sugar
- C. An increase in the wages of workers in the sugar industry
- D. An increase in the price of sugar substitutes
|
| 6 |
Perfectly inelastic supply curve is: |
- A. Parallel to vertical axis
- B. Parallel to horizontal axis
- C. Rises upward to the right
- D. Falls downward to the right
|
| 7 |
Extension of supply will take place as a consequence of: |
- A. Change in price
- B. Change in population
- C. Change in technology
- D. Change in money supply
|
| 8 |
Demands and supply curves cross at |
- A. always at 60 degree
- B. at 90 degree
- C. at equal angle
- D. at any angle
|
| 9 |
Market equilibrium means |
- A. number of buyers and sellers are equal
- B. demand and supply of commodity are equal
- C. no price is changing
- D. prices rise very slowly
|
| 10 |
When price is fixed below equilibrium level, there will be |
- A. surplus commodity in the market
- B. shortage of commodity in the market
- C. supply curve will shift
- D. demand curve will shift
|
