Understanding Supply and Demand Shifts Quiz

If a new technology in the production of electric cars makes them cheaper to produce, what happens to the supply curve for electric cars?

• It shifts to the left.

• It shifts to the right.

• It remains unchanged.

• It becomes more elastic.

When the price of beef increases, what happens to the demand for chicken, assuming chicken and beef are substitutes?

• Demand for chicken decreases.

• Demand for chicken increases.

• Demand for chicken remains unchanged.

• Demand for chicken becomes perfectly inelastic.

If the government imposes a tax on carbon emissions, what is likely to happen to the supply curve for gasoline?

• It shifts to the right.

• It shifts to the left.

• It remains unchanged.

• It becomes perfectly elastic.

A decrease in the price of cotton leads to what change in the supply curve for cotton shirts?

• It shifts to the left.

• It shifts to the right.

• It remains unchanged.

• It becomes more inelastic.

If consumers expect the price of smartphones to rise in the near future, what happens to the current demand for smartphones?

• It decreases.

• It increases.

• It remains unchanged.

• It becomes perfectly elastic.

When a popular celebrity endorses a new brand of sneakers, what happens to the demand curve for these sneakers?

• It shifts to the left.

• It shifts to the right.

• It remains unchanged.

• It becomes more inelastic.

If the price of a good is above the equilibrium price, what is likely to happen in a competitive market?

• Quantity demanded exceeds quantity supplied, leading to a surplus.

• Quantity supplied exceeds quantity demanded, leading to a surplus.

• Quantity demanded equals quantity supplied.

• Quantity supplied becomes perfectly inelastic.

An increase in income leads to a decrease in demand for a good. What type of good is this?

• Normal good.

• Inferior good.

• Substitute good.

• Complementary good.

What happens to the equilibrium price and quantity when there is an increase in demand, holding supply constant?

• Equilibrium price and quantity both decrease.

• Equilibrium price increases, but quantity decreases.

• Equilibrium price and quantity both increase.

• Equilibrium price decreases, but quantity increases.

If the price of raw materials for producing laptops increases, what happens to the producer surplus in the laptop market?

• It increases.

• It decreases.

• It remains unchanged.

• It becomes negative.