Understanding Demand in Microeconomics

Which of the following is NOT a requirement to be considered part of the demand for a product?

• Desire to purchase

• Willingness to purchase

• Ability to purchase

• Knowledge of the product

What does the law of demand state about the relationship between price and quantity demanded?

• As price decreases, quantity demanded decreases

• As price increases, quantity demanded increases

• As price increases, quantity demanded decreases

• Price and quantity demanded are unrelated

What is marginal utility?

• The decrease in satisfaction from consuming a product

• The additional satisfaction from consuming one more unit of a product

• The total satisfaction from consuming a product

• The cost of producing one more unit of a product

What is diminishing marginal utility?

• The decrease in satisfaction with each additional unit consumed

• The satisfaction from the first unit consumed

• The constant satisfaction with each additional unit consumed

• The increase in satisfaction with each additional unit consumed

Which of the following is a factor that can cause a shift in the demand curve?

• Change in the number of suppliers

• Change in government regulations

• Change in production technology

• Change in consumer income

What is the difference between a change in demand and a change in quantity demanded?

• Change in demand refers to movement along the demand curve, while change in quantity demanded refers to a shift of the demand curve

• Change in demand refers to a shift of the demand curve, while change in quantity demanded refers to movement along the demand curve

• Both refer to movement along the demand curve

• Both refer to a shift of the demand curve

What does it mean if demand is elastic?

• Demand is inversely related to price changes

• Demand is not sensitive to price changes

• Demand is very sensitive to price changes

• Demand is proportional to price changes

Which of the following is a characteristic of inelastic demand?

• Demand changes significantly with a small price change

• Demand does not change significantly with a price change

• Demand is proportional to price changes

• Demand decreases as price decreases

What is unit elastic demand?

• Demand changes are less than price changes

• Demand does not change with price changes

• Demand changes are equal to price changes

• Demand changes are greater than price changes

How is total revenue calculated?

• Price times quantity demanded

• Price minus quantity demanded

• Price plus quantity demanded

• Price divided by quantity demanded