Economics MCQs

Page No. 254

A movement along the demand curve may be caused by ?


a A change in income


b A change in the number of buyers


c A change in advertising


dA shift in supply


View Answer A shift in supply

Assuming a downward sloping demand curve and upward sloping supply curve a higher equilibrium price may be caused by ?


a An fall in demand


bAn increase in supply


c improvements in production technology


d An increase in demand



A reduction in the costs of production will ?


a Lead to a movement along the supply curve


b Shift the demand curve


c Shift the supply curve


dLead to an extension of supply



If demand increase in a market this will usually lead to ?


a A higher equilibrium price and output


bA lower equilibrium price and higher output


cA lower equilibrium price and output


dA higher equilibrium price and lower output



Suppose both buyers and sellers of wheat expect the price of wheat to rise in the near future. What would we expect to happen to the equilibrium price and quantity in the market for wheat today ?


aThe impact on both price and quantity is ambiguous


b Price will decrease, quantity is ambiguous.


cprice will increase, quantity will decrease


dprice will increase, quantity is ambiguous.



Suppose a frost destroys much of the Florida orange crop. At the same time, suppose consumer tastes shift toward orange juice, What would we expect to happen to the equilibrium price and quantity in the market for orange juice ?


aprice will decrease, quantity is ambiguous


bPrice will increase, quantity will increase


c price will increase, quantity will decrease


d price will increase, quantity is ambiguous.



Suppose there is an increase in the both the supply and demand for personal computers Further, suppose the supply of personal computer increase more than demand for personal computers In the market for personal computers i the market for personal computers, we would expect ?


athe change in the equilibrium quantity to be ambiguous and the equilibrium price to fall.


bthe equilibrium quantity to rise and the equilibrium price to rise


cthe equilibrium quantity to rise and the change in the equilibrium price to be ambiguous


d the equilibrium quantity to rise and the equilibrium price to fall



A decrease (leftward shift) in the supply for a good will tend to cause ?


aan increase in the equilibrium price and quantity


b a decrease in the equilibrium price and an increase in the equilibrium quantity


c none of these answers


dan increase in the equilibrium price and a decrease in the equilibrium quantity



If the price of good is equal to the equilibrium price ?


a there is a shortage and the price will fall


bthe quantity demanded is equal to the quantity supplied supplied and the price remains unchanged


c there is surplus and the price will rise


d there is a surplus and the price will fall



If the price of a good is above the equilibrium price ?


athere is a surplus and the price will rise


bthere is a shortage and the price will fall


cthere is a shortage and the price will rise


dthere is a surplus and the price will fall



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