Market Equilibrium Quiz

What is market equilibrium?

• A situation when quantity demanded and quantity supplied are equal

• A situation when quantity demanded is greater than quantity supplied

• A situation when quantity demanded is less than quantity supplied

• A situation when there is no demand or supply

What happens when there is a shortage in the market?

• Price increases and quantity demanded decreases

• Price decreases and quantity demanded increases

• Price increases and quantity demanded increases

• Price decreases and quantity demanded decreases

What happens when there is a surplus in the market?

• Price decreases and quantity demanded decreases

• Price increases and quantity demanded increases

• Price decreases and quantity demanded increases

• Price increases and quantity demanded decreases

What is the representation of market equilibrium?

• Qd / Qs

• Qd = a – bP

• Qs = C + dP

• Qd = Qs

When demand increases and supply is held constant, what happens to the equilibrium price and quantity?

• Price increases and quantity increases

• Price decreases and quantity decreases

• Price increases and quantity decreases

• Price decreases and quantity increases

When supply increases and demand is held constant, what happens to the equilibrium price and quantity?

• Price decreases and quantity increases

• Price increases and quantity decreases

• Price decreases and quantity decreases

• Price increases and quantity increases

When both demand and supply increase in similar proportions, what happens to the equilibrium price and quantity?

• Price remains the same and quantity increases

• Price decreases and quantity remains the same

• Price increases and quantity remains the same

• Price remains the same and quantity decreases

When both demand and supply decrease in similar proportions, what happens to the equilibrium price and quantity?

• Price remains the same and quantity decreases

• Price decreases and quantity remains the same

• Price increases and quantity remains the same

• Price remains the same and quantity increases

When demand increases and supply decreases at same proportion, what happens to the equilibrium price and quantity?

• Price increases and quantity remains the same

• Price decreases and quantity remains the same

• Price increases and quantity increases

• Price decreases and quantity decreases

When demand decreases and supply increases at the same proportion, what happens to the equilibrium price and quantity?

• Price decreases and quantity remains the same

• Price increases and quantity remains the same

• Price decreases and quantity decreases

• Price increases and quantity increases