WorksheetsBehind the Demand Curve Quiz
Total questions: 15
Worksheet time: 8mins
Name
Class
Date
1.
If a 2% change in the price of a good leads to a 10% change in the quantity demanded of a good, what is the price elasticity of demand?
a)
0.02
b)
0.2
c)
5
d)
10
2.
If a decrease in price from $2 to $1 causes an increase in quantity demanded from 100 to 120, using the midpoint method, price elasticity of demand equals.
a)
0.17
b)
0.27
c)
0.4
d)
2.5
3.
When there is an increase in the price of an inferior good, which of the following will decrease the quantity of that good demanded?
a)
The Giffen effect
b)
The income effect only
c)
The substitution effect only
d)
Both the income and substitutions effects
4.
A perfectly elastic demand curve is
a)
upward-sloping
b)
vertical
c)
horizontal
d)
downward sloping
5.
Which of the following would cause the demand for a good to be relatively inelastic?
a)
The good has a large number of close substitutes
b)
There is lots of time to adjust to price changes
c)
The good is a necessity
d)
The price of the good is high
6.
Which of the following is correct for a price increase?
When demand is ______, total revenue will ______.
When demand is ______, total revenue will ______.
a)
inelastic, decrease
b)
elastic, decrease
c)
unit-elastic, increase
d)
elastic, increase
7.
Total revenue is maximized when demand is
a)
elastic
b)
inelastic
c)
unit-elastic
d)
infinite
8.
If the cross-price elasticity of demand between two goods is negative, this means that the two goods are
a)
substitutes
b)
complements
c)
normal
d)
inferior
9.
The income elasticity of demand for a normal good is
a)
zero
b)
one
c)
positive
d)
negative
10.
Which of the following leads to a more inelastic price elasticity of supply?
I. the use of inputs that are easily obtained
II. a higher degree of substitutability between inputs
III. a shorter time period in which to supply the good
I. the use of inputs that are easily obtained
II. a higher degree of substitutability between inputs
III. a shorter time period in which to supply the good
a)
I only
b)
II only
c)
III only
d)
I, II, and III
11.
What is the value of consumer surplus when the market price is $40?
a)
$400
b)
$800
c)
$4,000
d)
$8,000
12.
What is the value of producer surplus when the market price is $60?
a)
$100
b)
$200
c)
$1000
d)
$2000
13.
All other things equal, a rise in price will result in which of the following?
a)
Producer surplus will rise; consumer surplus will rise.
b)
Producer surplus will fall; consumer surplus will fall.
c)
Producer surplus will rise; consumer surplus will fall.
d)
Producer surplus will fall; consumer surplus will rise.
14.
Consumer surplus is found as the area
a)
above the demand curve but below the price
b)
below the demand curve but above the price
c)
above the supply curve but below the price
d)
below the supply curve but above the price
15.
Allocating kidneys to those with the highest net benefit (where net benefit is measured as the expected increase in life span from a transplant) is an attempt to maximize
a)
consumer surplus
b)
producer surplus
c)
equity
d)
profit
100 %
