WorksheetsA Level Business: Demand and Supply Quiz
Total questions: 60
Worksheet time: 45mins
When the price of Pepsi rises, Coca-Cola notices an increase in its sales. This is because:
Pepsi and Coca-Cola are complementary goods
The demand for Pepsi has become more inelastic
Pepsi and Coca-Cola are substitutes
Pepsi has become an inferior good
The demand for petrol falls sharply after a surge in electric car sales. This is best explained by:
A fall in consumer income
A change in a substitute good
A change in a complementary good
Seasonal factors
Luxury watch sales fall during a recession. What type of good is this?
Inferior
Normal
Complementary
Necessity
When household income rises, demand for budget supermarkets like Aldi decreases. This suggests Aldi’s goods are:
Normal goods
Inferior goods
Complementary goods
Substitutes
A sudden viral TikTok trend boosts demand for a new brand of trainers. This is an example of:
Seasonal demand
Change in consumer income
Change in fashion and tastes
Government intervention
After an intense advertising campaign, demand for Dove body wash increases. This demonstrates that:
Advertising shifts demand to the right
Supply has increased
Price elasticity of supply has changed
External shocks are influencing demand
Apple maintains strong sales even when prices rise. This is because:
It faces many substitutes
Consumer incomes are falling
Advertising is ineffective
Strong branding reduces price sensitivity
An aging population increases demand for healthcare services. This is an example of:
A change in tastes
A demographic change
A technological improvement
An indirect tax effect
After the government announces a fuel subsidy, demand for cars increases. This is due to:
A supply shift
An external shock increasing disposable income
Seasonal factors
Substitutes becoming cheaper
Demand for ice cream rises sharply in July but drops in December. This is caused by:
Advertising
Substitutes
Seasonality
Consumer incomes
When consumer income rises and advertising improves, what happens to demand?
It shifts left
It shifts right
It contracts
It expands
If Burberry increases prices and still sells out, what can be inferred?
Burberry products are Giffen goods
Burberry products are luxury goods
Income elasticity is negative
Demand is perfectly elastic
When incomes rise, sales of supermarket value brands fall. This is because:
They are complementary goods
They are substitutes
They are inferior goods
They are normal goods
Demand for flights drops after a major volcanic eruption. This is due to:
Advertising
Seasonality
External shock
Demographic change
After health campaigns, fewer people buy sugary drinks. This is an example of:
A rise in income
A change in fashion/taste
A fall in supply
Government subsidy
If oil prices increase, the supply of airline tickets is likely to:
Increase
Stay the same
Decrease
Double
Amazon introduces warehouse robots, reducing costs. What happens to supply?
It shifts left
It shifts right
It contracts
It expands
When the government increases cigarette tax, supply of cigarettes will likely:
Shift left
Shift right
Remain unchanged
Become more elastic
If the UK government subsidises solar panels, supply will:
Increase
Decrease
Stay constant
Contract
Floods destroy wheat crops in India. Supply of wheat:
Increases
Falls
Becomes more elastic
Remains stable
The government introduces a subsidy reducing the cost of producing solar panels by £50 per unit. Supply increases from 500 to 700 units.
👉 Calculate % change in supply.
A firm produces 2,000 units at £20 each. If costs rise by 10%, what is the new total cost?
A factory produces 1,500 units at a cost of £6,000. After automation, costs fall to £4,500 for the same output.
👉 Calculate percentage cost reduction.
A business expects revenue of £120,000 but experiences an external shock that reduces demand by 15%.
👉 Calculate revised revenue.
The government introduces an indirect tax of £2 per unit. If equilibrium price before tax was £10, what is the new consumer price if producers absorb half the tax?
When the price of bread rises, demand for butter falls. This is because:
Butter is a necessity
Bread is an inferior good
Bread and butter are substitutes
Bread and butter are complementary goods
After a successful celebrity endorsement, demand for a sports drink surges. This is an example of:
Government intervention
Change in tastes and preferences
Seasonal demand
Technological improvement
If the government imposes a high tax on luxury cars, what is likely to happen to their supply?
Supply will increase
Supply will decrease
Supply will become perfectly elastic
Supply will remain unchanged
If the price of coffee increases, what is likely to happen to the demand for tea?
It will become perfectly elastic
It will remain unchanged
It will increase
It will decrease
What effect does a technological breakthrough in smartphone manufacturing have on the supply of smartphones?
Supply becomes inelastic
Supply contracts
Supply shifts right
Supply shifts left
When a new health study links red meat to health risks, what is likely to happen to the demand for red meat?
Demand increases
Demand shifts left
Demand becomes perfectly elastic
Demand remains unchanged
What is likely to happen to the demand for public transport if fuel prices rise sharply?
Demand will decrease
Demand will remain unchanged
Demand will become perfectly elastic
Demand will increase
If a new study shows that eating vegetables improves health, what is the expected effect on the demand for vegetables?
Demand becomes inelastic
Demand contracts
Demand shifts right
Demand shifts left
When the price of smartphones falls, what is likely to happen to the demand for smartphone accessories?
It will become perfectly elastic
It will decrease
It will increase
It will remain unchanged
A new tax on sugary snacks increases retail prices. Demand for snacks:
A) Increases
B) Decreases
C) Stays unchanged
D) Becomes more elastic
What is likely to happen to the demand for umbrellas during a rainy season?
Demand will become perfectly elastic
Demand will decrease
Demand will remain unchanged
Demand will increase
If the price of smartphones falls, what is the expected effect on the demand for smartphone accessories?
Demand will become inelastic
Demand will remain unchanged
Demand will increase
Demand will decrease
After a major health scare, demand for processed foods drops sharply. This is an example of:
Technological improvement
Seasonal demand
Government subsidy
Change in tastes and preferences
According to the law of demand, as price rises, what happens to quantity demanded?
It goes up
It goes down
It stays the same
No change
What does this curve represent?
Supply
Equilibrium
Demand
Surplus
Which of the following will cause an increase in the quantity demanded of snowboards?
More costly production methods
A decrease in the price of lift tickets at snowboarding resorts
A decrease in consumer income
A decrease in the population
The movement from Point A to Point B represents a(n)
increase in the price
decrease in the quantity supplied
shift in the supply curve
Which diagram shows the supply curve?
A
B
C
D
According to the law of supply, if the price of a product increases...
Supply decreases
Supply increases
Supply won't change
None of the above
A government payment that supports a business or market.
negative marginal return
subsidy
excise tax
regulation
Which of the following is NOT a factor causing a shift in the demand curve?
Changes in income
Changes in consumer preferences
Changes in the price of the good itself
Changes in the price of substitutes
What is an example of complementary goods?
Coca-Cola and Pepsi
iPhones and phone cases
Corn and wheat
Coffee and tea
What happens to the supply of a good when the price increases, according to the law of supply?
It decreases
It remains constant
It increases
It fluctuates randomly
What term describes the point where demand equals supply in a market?
Demand curve
Market mechanism
Equilibrium
Elasticity
How does an increase in personal disposable income affect demand?
It shifts the demand curve to the left
It causes movement along the demand curve
It shifts the demand curve to the right
It decreases the quantity demanded
What is the effect of natural disasters on the supply curve?
It shifts the supply curve to the right
It shifts the supply curve to the left
It causes movement along the supply curve
It has no effect on the supply curve
Supply is best defined as
the amount of goods and services sellers are willing and able to produce at a given price
a state where economic forces such as supply and demand are balanced
any structure that allows buyers & sellers to exchange goods & services
a variety of different resources available
Refer to the supply schedule above. At a price of $4, what is the quantity supplied for oranges?
5
10
15
20
What is the equilibrium price and quantity for fruit snacks? Use the market schedule to answer.
Price: $3.00, Quantity: 30
Price: $4.50, Quantity: 50
Price: $6.00, Quantity: 30
Price: $7.50, Quantity: 60
At a price of $9.00, which of the following is true? Use the market schedule to answer.
there is a shortage of 20 units
there is a surplus of 20 units
there is a surplus of 90 units
there is a shortage of 110 units
On the graph above, the shift from S1 to S2 could be caused by
a natural disaster destroys key factories
an increase in consumer income
an improvement in technology to produce goods.
an increase in resource prices.
At a price of $9.00, which of the following is true? Use the market schedule to answer.
there is a shortage of 20 units
there is a surplus of 20 units
there is a surplus of 90 units
there is a shortage of 110 units
