This quiz works best with JavaScript enabled. Home > Economics > Microeconomics > Demand And Supply Analysis > Demand And Supply Analysis – Quiz 5 🏠 Homepage 📘 Download PDF Books 📕 Premium PDF Books Demand And Supply Analysis Quiz 5 (20 MCQs) Quiz Instructions Select an option to see the correct answer instantly. 1. The minimum price that can be charged for a good or service. A) Price ceiling. B) Price floor. C) Shortage. D) Equilibrium. Show Answer Correct Answer: B) Price floor. 2. The price of coffee beans decreases significantly. How will this impact the supply side of the market for coffee beans? A) The supply will increase. B) The supply will decrease. C) Supply will not change, but quantity supplied will increase. D) Supply will not change, but quantity supplied will decrease. Show Answer Correct Answer: D) Supply will not change, but quantity supplied will decrease. 3. Suppose the economy is producing below the natural rate of output and the government is suffering from large budget deficits. To deal with the deficit problem, suppose the government takes a policy action to reduce the size of the deficits. This policy action will cause ..... in the unemployment rate in the short run and ..... in inflation in the short run, everything else held constant. A) An increase; an increase. B) A decrease; a decrease. C) A decrease; an increase. D) An increase; a decrease. Show Answer Correct Answer: D) An increase; a decrease. 4. The production relationship between the number of machine hours and totalproduct for a company is presented below.Diminishing marginal returns first occur beyond machine hour: A) 3. B) 4. C) 5. D) None of above. Show Answer Correct Answer: A) 3. 5. If the price elasticity coefficient of the demand curve for paper clips is equal to-1, demand is: A) Elastic. B) Inelastic. C) Unit elastic. D) None of above. Show Answer Correct Answer: C) Unit elastic. 6. The expectations-augmented Phillips curve implies that as expected inflation increases, nominal wages ..... to prevent real wages from ..... A) Rise; rising. B) Rise; falling. C) Fall; falling. D) Fall; rising. Show Answer Correct Answer: B) Rise; falling. 7. Situation created when the quantity supplied is less than the quantity demanded. A) Equilibrium price. B) Shortage. C) Surplus. D) Disequilibrium. Show Answer Correct Answer: B) Shortage. 8. Nature of demand curve is ..... A) Left to right upward. B) Left to right downward. C) Parallel to the X-axis. D) Parallel to Y-axis. Show Answer Correct Answer: B) Left to right downward. 9. State True or FalsePrice low X Demand medium A) False. B) True. Show Answer Correct Answer: A) False. 10. The willingness and ability to sell something in a given time period. A) Supply. B) Demand. C) Law of supply. D) Law of demand. Show Answer Correct Answer: A) Supply. 11. A company is experiencing economies of scale when: A) Cost per unit increases as output increases. B) It is operating at a point on the LRAC curve where the slope is negative. C) It is operating beyond the minimum point on the long-run average total cost curve. D) None of above. Show Answer Correct Answer: B) It is operating at a point on the LRAC curve where the slope is negative. 12. Break-even point is achieved when: A) National income= consumption. B) Consumption = saving. C) Consumption= investment. D) National income > consumption,. Show Answer Correct Answer: A) National income= consumption. 13. What is the relationship between different markets where one product complements another? A) Joint supply. B) Derived demand. C) Alternative demand. D) Joint demand. Show Answer Correct Answer: D) Joint demand. 14. What happens when there is a decrease in supply of a product? A) Rise in price and extension in demand. B) Fall in price and extension in demand. C) Rise in price and contraction in demand. D) Fall in price and contraction in demand. Show Answer Correct Answer: C) Rise in price and contraction in demand. 15. The maximum price that can be charged for a good or service. A) Price ceiling. B) Price floor. C) Minimum wage. D) Equilibrium. Show Answer Correct Answer: A) Price ceiling. 16. In the long run, following a combination of a negative demand shock and a temporary negative supply shock, A) Both inflation and output return to the original long-run equilibrium values. B) Inflation is permanently increased, while output returns to potential output. C) Output returns to potential output, while inflation may be higher or lower than its initial value. D) Inflation is permanently reduced, while output returns to potential output. Show Answer Correct Answer: D) Inflation is permanently reduced, while output returns to potential output. 17. A change in producer expectations. A) Shift in Supply. B) Shift in Demand. Show Answer Correct Answer: A) Shift in Supply. 18. The price of bananas increase dramatically. How will this affect the demand side of market for bananas? A) Demand will increase. B) Demand will decrease. C) Demand will remain the same, but quantity demanded will increase. D) Demand will remain the same, but quantity demanded will decrease. Show Answer Correct Answer: D) Demand will remain the same, but quantity demanded will decrease. 19. When the position of the demand curve will shift to the left or right following a change in determinant of demand is called as A) Shift in demand. B) Movement along the supply Curve. C) Movement along the Demand Curve. D) Shift in supply. Show Answer Correct Answer: A) Shift in demand. 20. The ..... price is the price at which the quantity demanded is equal demanded equal to the quantity supplied. A) Equilibrium. B) Disequilibrium. C) Reservation. D) All the above. Show Answer Correct Answer: A) Equilibrium. ← PreviousNext →Related QuizzesMicroeconomics QuizzesEconomics QuizzesDemand And Supply Analysis Quiz 1Demand And Supply Analysis Quiz 2Demand And Supply Analysis Quiz 3Demand And Supply Analysis Quiz 4Demand And Supply Analysis Quiz 6Demand And Supply Analysis Quiz 7 🏠 Back to Homepage 📘 Download PDF Books 📕 Premium PDF Books