Q. An increase in demand would cause supply curve to: A. Shift to the left B. Shift to the right C. Change in slope of supply curve D. No effect on supply Answer: No effect on supply
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Q. Supply curve will shift when: A. Price falls B. Price rises C. Demand shifts D. Technology change Answer: Technology change
Q. What does price elasticity of demand measure? A. Change in price caused by changes in demand B. The rate of change of sales C. The responsiveness of demand to price changes D. The value of sales of a given price Answer: The responsiveness of demand to price changes
Q. It describes the law of supply: A. Supply curve B. Supply schedule C. Supply equation D. All the three Answer: All the three
Q. Which one is increasing function of price: A. Demand B. Utility C. Supply D. Consumption Answer: Supply
Q. If price and total revenue move in the same direction, then demand is: A. Inelastic B. Elastic C. Unrelated D. Perfectly elastic Answer: Inelastic
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Q. Demand is a function of: A. Price B. Quantity C. Supply D. None of these Answer: Price
Q. Income elasticity of demand for normal good is always: A. 1 B. More than one C. Negative D. Positive Answer: Positive
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Q. When price elasticity of demand for normal goods is calculated, the value is always: A. Positive B. Negative C. Constant D. Greater than one Answer: Negative
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Q. This is an assumption of law of demand: Price of the commodity should not change Quantity should not change Supply should not change Income of consumer should not change Answer: Income of consumer should not change
