Theory Of Demand And Supply

20 Questions  I  By Sweetsalman123 on February 28, 2012
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1.  Point elasticity is useful for which of the following situations?
A.
B.
C.
D.
2.  The supply curve shifts to the right because of ____________.        
A.
B.
C.
D.
3.  Demand is the         
A.
B.
C.
D.
4.  Elasticity of supply is zero means   
A.
B.
C.
D.
5.  Chicken and fish are substitutes. If the price of chicken increases, the demand for fish will          
A.
B.
C.
D.
6.  The consumer is in equilibrium when the following condition is satisfied : (a) «math xmlns=¨http://www.w3.org/1998/Math/MathML¨»«mfrac»«mrow»«mi»M«/mi»«msub»«mi»U«/mi»«mi»X«/mi»«/msub»«/mrow»«mrow»«mi»M«/mi»«msub»«mi»U«/mi»«mi»Y«/mi»«/msub»«/mrow»«/mfrac»«mo»§nbsp;«/mo»«mo»§gt;«/mo»«mfrac»«msub»«mi»P«/mi»«mi»X«/mi»«/msub»«msub»«mi»P«/mi»«mi»Y«/mi»«/msub»«/mfrac»«mo»§#183;«/mo»«/math» (b) «math xmlns=¨http://www.w3.org/1998/Math/MathML¨»«mtable columnalign=¨left¨ rowspacing=¨0¨»«mtr»«mtd/»«/mtr»«mtr»«mtd»«mfrac»«mrow»«mi»M«/mi»«msub»«mi»U«/mi»«mi»X«/mi»«/msub»«/mrow»«mrow»«mi»M«/mi»«msub»«mi»U«/mi»«mi»Y«/mi»«/msub»«/mrow»«/mfrac»«mo»§nbsp;«/mo»«mo»§lt;«/mo»«mfrac»«msub»«mi»P«/mi»«mi»X«/mi»«/msub»«msub»«mi»P«/mi»«mi»Y«/mi»«/msub»«/mfrac»«mo»§#183;«/mo»«/mtd»«/mtr»«/mtable»«/math» (c) «math xmlns=¨http://www.w3.org/1998/Math/MathML¨»«mfrac»«mrow»«mi»M«/mi»«msub»«mi»U«/mi»«mi»X«/mi»«/msub»«/mrow»«mrow»«mi»M«/mi»«msub»«mi»U«/mi»«mi»Y«/mi»«/msub»«/mrow»«/mfrac»«mo»§nbsp;«/mo»«mo»=«/mo»«mfrac»«msub»«mi»P«/mi»«mi»X«/mi»«/msub»«msub»«mi»P«/mi»«mi»Y«/mi»«/msub»«/mfrac»«/math» (d) None of the above.
A.
B.
C.
D.
7.  If a good is a luxury, its income elasticity of demand is :
A.
B.
C.
D.
8.  Total utility is maximum when :
A.
B.
C.
D.
9.  Which of the following statements is correct?                                                              
A.
B.
C.
D.
10.  If the local pizzeria raises the price of a medium pizza from Rs.60 to Rs. 100 and quantity ] demanded falls from 700 pizzas a night to 100 pizzas a night, the price elasticity of demand
A.
B.
C.
D.
11.  A discount store has a special offer on CDs. It reduces their price from Rs.150 to Rs. 100. Suppose the store manager observes that the quantity demanded increases from 700 CDs to 1,300 CDs. What is the price elasticity of demand for CDs?
A.
B.
C.
D.
12.  Which one is not an assumption of the theory of demand based on analysis of indifference curves?
A.
B.
C.
D.
13.  The Law of Demand, assuming other things to remain constant, establishes the relationship between :
A.
B.
C.
D.
14.  Elasticity of supply is measured by dividing the percentage change in quantity supplied of a good by 
A.
B.
C.
D.
15.  Identify the factor which generally keeps the price-elasticity of demand for a good low :
A.
B.
C.
D.
16.  If the demand for a good is inelastic, an increase in its price will cause the total expenditure of the consumers of the good to :
A.
B.
C.
D.
17.  When supply curve moves to the left it means
A.
B.
C.
D.
18.  Demand for a commodity refers to :
A.
B.
C.
D.
19.  The price of a commodity decreases from Rs. 6 to Rs. 4 and his demand for goods increases from 10 units to 15 units, Find the coefficient of price elasticity.
A.
B.
C.
D.
20.  Contraction of demand is the result of :   
A.
B.
C.
D.
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