This quiz works best with JavaScript enabled. Home > Economics > Microeconomics > Demand And Supply Analysis > Demand And Supply Analysis – Quiz 6 🏠 Homepage 📘 Download PDF Books 📕 Premium PDF Books Demand And Supply Analysis Quiz 6 (20 MCQs) Quiz Instructions Select an option to see the correct answer instantly. 1. According to aggregate demand and supply analysis, America's involvement in the Vietnam War had the effect of A) Decreasing aggregate output, lowering unemployment, and lowering the inflation. B) Increasing aggregate output, raising unemployment, and raising the inflation. C) Increasing aggregate output, lowering unemployment, and raising the inflation. D) Decreasing aggregate output, raising unemployment, and lowering the inflation. Show Answer Correct Answer: C) Increasing aggregate output, lowering unemployment, and raising the inflation. 2. State True or FalsePrice high O Demand high A) True. B) False. C) Maybe. D) None of above. Show Answer Correct Answer: B) False. 3. The amount of a good consumers are willing and able to buy at a specific price. A) Quantity supplied. B) Demand. C) Supply. D) Quantity demand. Show Answer Correct Answer: D) Quantity demand. 4. Upward movement along the same demand curve is known as A) Expansion in Demand. B) Contraction in Demand. C) Increase in demand. D) Decrease in demand. Show Answer Correct Answer: B) Contraction in Demand. 5. A temporary negative supply shock ..... real interest rates and ..... output in the short run, thereby its effect on stock prices is ..... A) Raises; lowers; negative. B) Raises; raises; ambiguous. C) Lowers; raises; negative. D) Lowers; raises; positive. Show Answer Correct Answer: A) Raises; lowers; negative. 6. Suppose the U.S. economy is producing at the natural rate of output. A depreciation of the U.S. dollar will cause ..... in real GDP in the short run and ..... in inflation in the long run, everything else held constant. (Assume the depreciation causes no effects in the supply side of the economy.) A) An increase; a decrease. B) An increase; an increase. C) No change; a decrease. D) No change; an increase. Show Answer Correct Answer: B) An increase; an increase. 7. What is Production? A) Production is the act of creating an output, a good or service which has value and contributes to the utility of individuals. B) Production is an activity related to selling or the number of goods or services sold in a given time period. C) Production is the quantity of a good that consumers are willing and able to purchase at various prices during a given period of time. D) Production is the amount of a resource that firms, producers, labourers, providers of financial assets, or other economic agents are willing and able to provide to the marketplace or directly to another agent in the marketplace. Show Answer Correct Answer: A) Production is the act of creating an output, a good or service which has value and contributes to the utility of individuals. 8. ..... flexible wages and prices imply that the short-run aggregate supply curve is ..... A) More; flatter. B) Less; steeper. C) Less; vertical. D) More; steeper. Show Answer Correct Answer: D) More; steeper. 9. The Phillips curve indicates that when the labor market is ....., production costs will ..... and aggregate supply increases. A) Easy; fall. B) Tight; fall. C) Easy; rise. D) Tight; rise. Show Answer Correct Answer: A) Easy; fall. 10. Quantity change is greater than the price change, the elasticity is ..... A) Less elastic. B) Unitary elastic. C) More elastic. D) Perfectly inelastic. Show Answer Correct Answer: C) More elastic. 11. Price elasticity of demand is defined as ..... A) Percentage Change in quantity demanded by percentage change in price. B) Percentage Change in price by percentage change in quantity demanded. C) Percentage change in supply by change in price. D) Change in price and change in supply. Show Answer Correct Answer: A) Percentage Change in quantity demanded by percentage change in price. 12. Factors responsible for shift in Demand A) Income of Consumer. B) Change in prices of substitute goods. C) Change in prices of Complementary goods. D) Changes in test and preferences. E) All the above. Show Answer Correct Answer: E) All the above. 13. The short-term breakeven point of production for a firm operating under perfectcompetition will most likely occur when: A) Price is equal to average total cost. B) Marginal revenue is equal to marginal cost. C) Marginal revenue is equal to average variable costs. D) None of above. Show Answer Correct Answer: A) Price is equal to average total cost. 14. The position of a supply curve will change following a change in one or more of the determinants of supply keeping price constant is known as A) Increase in demand. B) Shift in supply. C) Movement along the Demand Curve. D) Decrease in demand. Show Answer Correct Answer: B) Shift in supply. 15. A leftward shift in demand curve parallel to the original demand curve is known as A) Increase in demand. B) Movement along the supply Curve. C) Movement along the Demand Curve. D) Decrease in demand. Show Answer Correct Answer: D) Decrease in demand. 16. The sellers of Twinkies also sell healthy foods. With all the health regulations we have now, the sellers of Twinkies want to sell more healthy foods. The supply of Twinkies will decrease. What supply factor does this best relate to? A) Change in Technology. B) Change in Number of Sellers in the Market. C) Change in Profit Opportunities Producing other Products. D) None of above. Show Answer Correct Answer: C) Change in Profit Opportunities Producing other Products. 17. Following Factors are responsible for shift in Supply A) I.Changes in prices of raw material. B) Ii.Changes in tax policies. C) Iii.Changes in cost. D) Only i and ii. E) All the above. Show Answer Correct Answer: E) All the above. 18. A change in the price of substitute goods. A) Shift in Supply. B) Shift in Demand. Show Answer Correct Answer: B) Shift in Demand. 19. McDonald's is having a special on their Big Mac purchases this week. Every Big Mac is $ 3 cheaper! When burger prices go down, this means you can buy more fries and a drink. What demand factor does this relate to? A) Change in Consumer Tastes. B) Change in Price of Substitute Good. C) Change in Price of Complementary Good. D) Change in Number of Consumers in the Market. Show Answer Correct Answer: C) Change in Price of Complementary Good. 20. An improvement in manufacturing technology. A) Shift in Supply. B) Shift in Demand. Show Answer Correct Answer: A) Shift in Supply. ← 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 5Demand And Supply Analysis Quiz 7 🏠 Back to Homepage 📘 Download PDF Books 📕 Premium PDF Books