This quiz works best with JavaScript enabled. Home > Finance > Economics > Microeconomics > Demand And Supply Analysis > Demand And Supply Analysis – Quiz 1 🏠 Homepage 📘 Download PDF Books 📕 Premium PDF Books Demand And Supply Analysis Quiz 1 (30 MCQs) Quiz Instructions Select an option to see the correct answer instantly. 1. Market demand is obtained by? A) Vertical summation of individual demand. B) Horizontal summation of individual demand. C) Multiplying individual demand. D) Dividing individual demand. Show Answer Correct Answer: B) Horizontal summation of individual demand. 2. If workers demand and receive higher real wages (a successful wage push), the cost of production ..... and the short-run aggregate supply curve shifts ..... A) Rises; leftward. B) Rises; rightward. C) Falls; leftward. D) Falls; rightward. Show Answer Correct Answer: A) Rises; leftward. 3. The willingness and ability to buy something in a given time period. A) Supply. B) Demand. C) Law of supply. D) Law of demand. Show Answer Correct Answer: B) Demand. 4. Scarcity is a measure of supply A) False. B) True. Show Answer Correct Answer: B) True. 5. Point where the quantity supplied is equal to the quantity demanded. A) Shortage. B) Equilibrium price. C) Disequilibrium. D) Surplus. Show Answer Correct Answer: B) Equilibrium price. 6. Raw Material is considered as a supply product. A) False. B) True. Show Answer Correct Answer: B) True. 7. A change in the number of producers. A) Shift in Supply. B) Shift in Demand. Show Answer Correct Answer: A) Shift in Supply. 8. Write the meaning of Price high X Demand low. A) Means when price is high demand is low. B) Means when price is low demand is low and also Demand is high. Show Answer Correct Answer: A) Means when price is high demand is low. 9. The amount of a good producers are willing and able to sell at a specific price. A) Quantity supplied. B) Demand. C) Supply. D) Quantity demand. Show Answer Correct Answer: A) Quantity supplied. 10. Positive spending shocks lead to ..... output ..... A) Higher; in both the short and long runs. B) Higher; in the short run but not in the long run. C) Lower; in both the short and long runs. D) Lower; in the short run but not in the long run. Show Answer Correct Answer: B) Higher; in the short run but not in the long run. 11. People produce goods and services to earn ..... A) Clothes. B) Food. C) Money. D) None of these. Show Answer Correct Answer: C) Money. 12. Inflation affects the price of raw materials. A) True. B) False. Show Answer Correct Answer: A) True. 13. Expansion or a Contraction in demand remains along the ..... demand curve A) Different. B) Same. C) Two. D) None of the above. Show Answer Correct Answer: B) Same. 14. A change in consumer income. A) Shift in Supply. B) Shift in Demand. Show Answer Correct Answer: B) Shift in Demand. 15. Price elasticity of demand for a good will most likely be greater if: A) There are no substitutes for the good. B) Consumers consider the good as discretionary. C) Consumers spend a small portion of their budget on the good. D) None of above. Show Answer Correct Answer: B) Consumers consider the good as discretionary. 16. Aggregate supply and ..... are always equal. A) National income. B) Aggregate demand. C) Marginal propensity to save. D) Average propensity to consume. Show Answer Correct Answer: A) National income. 17. Porterville, California is now a major immigration center for Russians. Over 10, 000 Russians are living in Porterville now! What demand does this determine? A) Change in Consumer Price Expectations. B) Change in Consumer Tastes. C) Change in Consumer Income. D) Change in Number of Consumers in the Market. Show Answer Correct Answer: D) Change in Number of Consumers in the Market. 18. The marginal revenue per unit sold for a firm doing business under conditionsof perfect competition will most likely be: A) Equal to average revenue. B) Less than average revenue. C) Greater than average revenue. D) None of above. Show Answer Correct Answer: A) Equal to average revenue. 19. The manager of a small manufacturing firm gathers the following information about the firm's labor utilization and production.Refer to the data in Exhibit 2. The marginal product of labor demonstrates increasing returns for the firm if the number of workers is closest to but not more than: A) 2. B) 3. C) 4. D) None of above. Show Answer Correct Answer: B) 3. 20. In an attempt to make sure that poor Americans can also afford smart phones, the government imposes a price ceiling below the equilibrium price, prohibiting retailers from selling them above that price. How will this policy likely impact the smart phone market? A) It will greatly promote smart phone equity, ensuring that all Americans are now able enjoy this luxury. B) It will greatly increase profits for cell phone manufacturers. C) It will create a surplus of cheap, unsold smart phones. D) It will create a shortage in the smart phone market, leaving many would-be smart phone buyers unable to find one for sale. Show Answer Correct Answer: D) It will create a shortage in the smart phone market, leaving many would-be smart phone buyers unable to find one for sale. 21. The number of consumers for a product increases significantly. How will this affect the market price and quantity for that product? A) Price will decrease, quantity will increase. B) Price and quantity will both increase. C) Price will increase, quantity will decrease. D) Price and quantity will both decrease. Show Answer Correct Answer: B) Price and quantity will both increase. 22. What does the law of Supply state? A) It states that there must be supply in a store. B) There is a straight relationship between price and Supplied quantity. C) They both are correct. D) Both are wrong. Show Answer Correct Answer: B) There is a straight relationship between price and Supplied quantity. 23. ..... refers to actual savings in an economy during a year. A) MPS. B) Ex-post saving. C) Ex-ante saving. D) APS. Show Answer Correct Answer: B) Ex-post saving. 24. What is the result of an increase in demand for a product? A) Rise in price and extension in supply. B) Fall in price and contraction in supply. C) Rise in price and contraction in supply. D) Fall in price and extension in supply. Show Answer Correct Answer: A) Rise in price and extension in supply. 25. The price of a barrel of oil doubled between 2007 and the middle of 2008. To make matters worse, a financial crisis hit the U.S. economy starting in August of 2007. Which of the following is TRUE of the United Kingdom's experience? A) The increase in the price of oil immediately shifted the AS curve to the left. B) The financial crisis did not take hold right away so the AD curve did not immediately shift. C) Eventually, the Lehman Brothers bankruptcy caused a negative demand shock leading to a further fall in output and an increase in the unemployment rate. D) All of the above are true. Show Answer Correct Answer: D) All of the above are true. 26. For a Giffen good, the: A) Demand curve is positively sloped. B) Substitution effect overwhelms the income effect. C) Income and substitution effects are in the same direction. D) None of above. Show Answer Correct Answer: A) Demand curve is positively sloped. 27. Peanut butter and jelly are often purchased together by consumers. Economists would say these two goods are A) Subsidies. B) Normal goods. C) Substitutes. D) Complements. Show Answer Correct Answer: D) Complements. 28. The amount of money spent on making the goods and services is less than the price at which it is sold. A) False. B) True. Show Answer Correct Answer: B) True. 29. A change in the number of consumers. A) Shift in Supply. B) Shift in Demand. Show Answer Correct Answer: B) Shift in Demand. 30. According to aggregate demand and supply analysis, the rising oil prices coupled with the global financial crisis in 2007-2008 caused the unemployment rate to ..... and the level of real aggregate output to ..... A) Decrease; decrease. B) Increase; decrease. C) Increase; increase. D) Decrease; increase. Show Answer Correct Answer: B) Increase; decrease. Next →Related QuizzesMicroeconomics QuizzesEconomics QuizzesDemand And Supply Analysis Quiz 2Demand And Supply Analysis Quiz 3Demand And Supply Analysis Quiz 4Demand And Supply Analysis Quiz 5 🏠 Back to Homepage 📘 Download PDF Books 📕 Premium PDF Books