AppEcon Lesson 4

What does the Law of Demand state?

• If the price goes up, people buy more.

• If the price goes up, people buy less.

• If the price goes down, people buy less.

• Price changes do not affect buying behavior.

According to the demand schedule, how many cups are demanded at a price of ₱100?

• 2

• 4

• 6

• 10

What does a downward-sloping demand curve indicate?

• Higher price leads to higher demand.

• Lower price leads to lower demand.

• Lower price leads to higher demand.

• Price does not affect demand.

What is Price Elasticity of Demand?

• It shows how much people react to price changes.

• It shows how much sellers react to price changes.

• It shows the total quantity demanded.

• It shows the total quantity supplied.

Which of the following is an example of elastic demand?

• Rice

• Water

• Luxury bags

• Medicine

Which of the following is an example of inelastic demand?

• Milk tea

• Luxury bags

• Designer clothes

• Medicine

What does the Law of Supply state?

• If price goes up, sellers supply less.

• If price goes down, sellers supply more.

• If price goes up, sellers supply more.

• Price changes do not affect supply.

According to the supply schedule, how many cups are supplied at a price of ₱120?

• 4

• 6

• 8

• 12

What does an upward-sloping supply curve indicate?

• Higher price leads to less supply.

• Higher price leads to more supply.

• Lower price leads to more supply.

• Price does not affect supply.

If the price of milk tea doubles, what is the expected effect on demand?

• Demand will increase.

• Demand will decrease.

• Demand will remain the same.

• Demand will fluctuate randomly.