Principles of Microeconomics Quiz

What is the law of demand?

• A higher price leads to a higher quantity demanded.

• A higher price leads to a lower quantity demanded.

• A lower price leads to a lower quantity demanded.

• Price does not affect quantity demanded.

What does a demand curve represent?

• The relationship between price and quantity supplied.

• The relationship between price and quantity demanded.

• The cost structure of a firm.

• The total revenue of a firm.

What is equilibrium in a market?

• When quantity demanded equals quantity supplied.

• When prices are constantly changing.

• When quantity supplied is greater than quantity demanded.

• When quantity demanded is greater than quantity supplied.

What happens when the price is above the equilibrium level?

• There is a surplus.

• There is a shortage.

• Demand increases.

• Supply decreases.

What is the equilibrium price?

• The price where quantity demanded equals quantity supplied.

• The price where quantity supplied is greater than quantity demanded.

• The price where quantity demanded is greater than quantity supplied.

• The price where demand is zero.

What is a supply curve?

• A line showing the relationship between price and quantity supplied.

• A line showing the total cost of production.

• A line showing the total revenue.

• A line showing the relationship between price and quantity demanded.

What does a downward-sloping demand curve indicate?

• Buyers will purchase more at higher prices.

• Buyers will purchase less at higher prices.

• Buyers will not purchase at all.

• Buyers will purchase the same amount regardless of price.

What is the law of supply?

• A higher price leads to a lower quantity supplied.

• A higher price leads to a higher quantity supplied.

• A lower price leads to a higher quantity supplied.

• Price does not affect quantity supplied.

What is the difference between demand and quantity demanded?

• There is no difference.

• Quantity demanded refers to the entire demand curve.

• Demand refers to the entire demand curve, while quantity demanded refers to a specific point on the curve.

• Demand refers to a specific point on the demand curve.

What is the difference between supply and quantity supplied?

• Supply refers to a specific point on the supply curve.

• Supply refers to the entire supply curve, while quantity supplied refers to a specific point on the curve.

• Quantity supplied refers to the entire supply curve.

• There is no difference.