Supply and Demand Quiz

What does the supply and demand model primarily determine in a market?

• Government regulations

• Market monopolies

• Price determination

• Consumer preferences

In a perfectly competitive market, what is achieved when the quantity demanded equals the quantity supplied?

• Surplus

• Price ceiling

• Economic equilibrium

• Market failure

What happens to the supply curve when production costs decrease?

• It shifts to the right

• It becomes vertical

• It remains unchanged

• It shifts to the left

According to the law of demand, how does the demand curve generally slope?

• Upward

• Downward

• Vertical

• Horizontal

What is a common determinant of supply?

• Tastes and preferences

• Prices of inputs

• Consumer income

• Advertising

What is the term for a situation where the price is such that the quantity demanded is balanced by the quantity supplied?

• Market shortage

• Market inefficiency

• Market equilibrium

• Market surplus

What type of goods may see an increase in quantity demanded when the price rises?

• Luxury goods

• Giffen goods

• Normal goods

• Substitute goods

Who first introduced the graphical representation of supply and demand curves?

• David Ricardo

• Alfred Marshall

• Fleeming Jenkin

• Adam Smith

What is the effect of a rightward shift in the demand curve?

• Increases equilibrium price

• Decreases quantity supplied

• No effect on equilibrium price

• Decreases equilibrium price

What is the primary focus of partial equilibrium analysis?

• The entire economy

• A specific market

• Government policies

• Global trade