Economics Quiz

A downward-sloping demand curve reflects the:

• Positive relationship between price and quantity demanded

• Inverse relationship between price and quantity demanded

• Positive relationship between supply and demand

• Negative relationship between supply and demand

If a good has many close substitutes, the demand for it will likely be:

• Elastic

• Inelastic

• Unitary elastic

• Perfectly inelastic

A movement along the demand curve from one point to another is known as:

• A shift in demand

• A change in quantity demanded

• A change in demand

• A supply movement

When two goods are complementary, a fall in the price of one good will lead to:

• A decrease in demand for the other good

• An increase in demand for the other good

• No change in the demand for the other good

• A decrease in the quantity supplied of the other good

If the price of a good decreases from $20 to $15, and the quantity demanded increases from 100 to 150 units, what is the price elasticity of demand?

• -0.5

• -1.0

• -2.0

• -3.0

What does a movement along the demand curve indicate?

• Change in consumer preferences.

• Change in the price of the good itself.

• Change in the price of related goods.

• Change in consumer income.

If the PPC shifts outward, it indicates:

• A decrease in the quantity of resources.

• An improvement in technology or an increase in resources.

• A decrease in demand for goods.

• An increase in the price of goods.

In the context of the PPC, what is meant by 'opportunity cost'?

• The cost of producing one more unit of a good.

• The total cost incurred in production.

• The value of the next best alternative foregone when making a choice.

• The monetary cost of resources used.

The demand curve above shows a shift leftward from D1 to D2 in a graph. This leftward shift could be due to:

• An increase in consumer income

• A decrease in the price

• An increase in the price

• A decrease in consumer preferences for the good

What does the movement from point R to S denote?

• Economic development

• Underutilization of resources

• Full employment

• Economic growth.