Theory Of Demand And Supply

20 Questions  I  By Sweetsalman123
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1.  Elasticity of supply refers to the degree of responsiveness of supply of a good to changes in its :
A.
B.
C.
D.
2.  The supply curve shifts to the right because of ____________.        
A.
B.
C.
D.
3.  Point elasticity is useful for which of the following situations?
A.
B.
C.
D.
4.  When total demand for a commodity whose price has fallen increases, it is due to:  
A.
B.
C.
D.
5.  Demand for a good will tend to be more inelastic if it exhibits which of the following characteristics?
A.
B.
C.
D.
6.  With an increase in the price of diamond, its demand also increases. This is because it is a:      
A.
B.
C.
D.
7.  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.
8.  In the case of a straight line demand curve meeting the two axes, the price-elasticity of demand at the mid-point of the line would be :
A.
B.
C.
D.
9.  The price of hot dogs increases by 22% and the quantity of hot dogs demanded falls by 25%. This indicates that demand for hot dogs is :
A.
B.
C.
D.
10.  The price elasticity of demand for hamburger is      
A.
B.
C.
D.
11.  The second glass of lemonade gives lesser satisfaction to a thirsty boy. This is a clear case of       
A.
B.
C.
D.
12.  If price of computers increases by 10% and supply increases by 25%. The elasticity of supply is :
A.
B.
C.
D.
13.  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.
14.  Identify the factor which generally keeps the price-elasticity of demand for a good low :
A.
B.
C.
D.
15.  In the book market, the supply of books will decrease if any of the following occurs except
A.
B.
C.
D.
16.  The quantity purchased will remain constant irrespective of the change in income. This is known as
A.
B.
C.
D.
17.  The goods that exhibit direct price-demand relationship are called:                                                                                 
A.
B.
C.
D.
18.  An increase in price will result in an increase in total revenue if :
A.
B.
C.
D.
19.  Which of the following is a property of an indifference curve?
A.
B.
C.
D.
20.  The law of demand is :
A.
B.
C.
D.
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