Economics Quiz on Demand and Supply

What happens to the quantity demanded of a good when its price increases, according to the Law of Demand?

• The quantity demanded increases

• The quantity demanded decreases

• The quantity demanded remains the same

• The quantity demanded doubles

Which of the following is NOT a determinant of demand?

• Tastes and preferences

• Number of buyers

• Price of related goods

• Production technology

How do expectations about future prices affect current demand?

• They have no effect on demand

• They can increase or decrease current demand

• They only increase current demand

• They only decrease current demand

What is the relationship between income and demand for normal goods?

• Demand decreases as income rises

• Demand increases as income rises

• Demand remains constant as income rises

• Demand fluctuates randomly as income rises

According to the Law of Supply, what happens to the quantity supplied of a good when its price increases?

• The quantity supplied decreases

• The quantity supplied increases

• The quantity supplied remains the same

• The quantity supplied is halved

Which of the following is a determinant of supply?

• Cost of resources

• Consumer preferences

• Advertising

• Brand loyalty

How does technology affect supply?

• Increases costs and reduces supply

• Decreases efficiency and increases costs

• Increases efficiency and reduces costs

• Reduces efficiency and increases supply

What happens at market equilibrium?

• Quantity supplied exceeds quantity demanded

• Quantity demanded exceeds quantity supplied

• Quantity supplied equals quantity demanded

• Prices are unpredictable

What is the effect of a surplus in the market?

• Prices tend to increase

• Prices remain stable

• Prices tend to decrease

• Prices become unpredictable

What is the difference between profit and utility?

• Profit is the satisfaction from a good, utility is revenue minus costs

• Profit is revenue minus costs, utility is the satisfaction from a good

• Profit is the cost of production, utility is the market price

• Profit is the market price, utility is the cost of production