Demand and Supply MCQ Multiple Choice Questions Answers - Page 2 for Practice
31. A decrease in quantity demanded caused by an increase in price is represented by a
Correct Answer is: movement up and to the left along the demand curve.
32. People come to expect that the price of a gallon of gasoline will rise next week. As a result,
Correct Answer is: todays demand for gasoline increases.
33. A drop in the price of a compact disc shifts the demand curve for prerecorded tapes leftward. From that you know compact discs and prerecorded tapes are
Correct Answer is: substitutes.
34. People buy more of good 1 when the price of good 2 rises. These goods are
Correct Answer is: substitutes.
35. By definition, an inferior good is a
Correct Answer is: good for which demand decreases when income increases.
36. A substitute is a good
Correct Answer is: that can be used in place of another good.
37. Which of the following influences peoples buying plans and varies moving along a demand curve?
Correct Answer is: the price of the good
38. Which of the following is NOT held constant while moving along a supply curve?
Correct Answer is: the price of the good itself
39. The opportunity cost of good A in terms of good B is equal to the
Correct Answer is: ratio of the price of good A to the price of good B.
40. A decrease in the quantity supplied is represented by a
Correct Answer is: movement down the supply curve.
41. If the price of a good changes but everything else influencing suppliers planned sales remainsconstant, there is a
Correct Answer is: movement along the supply curve.
42. The law of demand implies that demand curves
Correct Answer is: slope down.
43. A change in the price of a good
Correct Answer is: does not shift the goods demand curve but does cause a movement along it.
44. The law of demand states that, other things remaining the same, the higher the price of a good, the
Correct Answer is: smaller is the quantity of the good demanded.
45. If a producer can use resources to produce either good A or good B, then A and B are
Correct Answer is: substitutes in production.
46. Suppose people buy more of good 1 when the price of good 2 falls. These goods are
Correct Answer is: complements.
47. The quantity demanded is
Correct Answer is: the amount of a good that consumers plan to purchase at a particular price.
48. When economists speak of preferences as influencing demand, they are referring to
Correct Answer is: an individuals attitudes toward goods and services.
49. Over the past decade technological improvements that have lowered the cost of producing an automobile have increased
Correct Answer is: the supply but not the demand for automobiles.
50. If a good is an inferior good, then purchases of that good will decrease when
Correct Answer is: income increases.
51. Each point on the demand curve reflects
Correct Answer is: the highest price consumers are willing and able to pay for that particular unit of a good.
52. Each point on a supply curve represents
Correct Answer is: the lowest price for which a supplier can profitably sell another unit.
53. The opportunity cost of a hot dog in terms of hamburgers is
Correct Answer is: the ratio of the price of a hot dog to the price of a hamburger.
54. Normal goods are those for which demand decreases as
Correct Answer is: income decreases.
55. A supply curve shows the relation between the quantity of a good supplied and
Correct Answer is: the price of the good. Usually a supply curve has positive slope.
56. A relative price is
Correct Answer is: the ratio of one price to another.
57. If income increases or the price of a complement falls
Correct Answer is: the demand curve for a normal good shifts rightward.
58. A normal good is a good for which
Correct Answer is: demand increases when income increases.
59. If income decreases or the price of a complement rises
Correct Answer is: the demand curve for a normal good shifts leftward.
60. A complement is a good
Correct Answer is: used in conjunction with another good.
