Demand and Supply Multiple Choice Questions and Answers

51. Each point on the demand curve reflects

1. the highest price consumers are willing and able to pay for that particular unit of a good.
2. the highest price sellers will accept for all units they are producing.
3. the lowest-cost technology available to produce a good.
4. all the wants of a given household.

52. Each point on a supply curve represents

1. the highest price sellers can get for each unit over time.
2. the lowest price buyers will accept per unit of the good.
3. the lowest price for which a supplier can profitably sell another unit.
4. the highest price buyers will pay for the good.

53. The opportunity cost of a hot dog in terms of hamburgers is

1. the price of a hot dog minus the price of a hamburger.
2. the ratio of the slope of the supply curve for hot dogs to the slope of the supply curve forhamburgers.
3. the ratio of the slope of the demand curve for hot dogs to the slope of the demand curve for hamburgers.
4. 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

1. the price of a substitute falls.
2. the price of a complement falls.
3. the goods own price rises.
4. income decreases.

55. A supply curve shows the relation between the quantity of a good supplied and

1. the price of the good. Usually a supply curve has negative slope.
2. income. Usually a supply curve has positive slope.
3. income. Usually a supply curve has negative slope.
4. the price of the good. Usually a supply curve has positive slope.

56. A relative price is

1. the ratio of one price to another.
2. the difference between one price and another.
3. the slope of the supply curve.
4. the slope of the demand curve.

57. If income increases or the price of a complement falls

1. the supply curve of a normal good shifts leftward.
2. the supply curve of a normal good shifts rightward.
3. the demand curve for a normal good shifts rightward.
4. the demand curve for a normal good shifts leftward.

58. A normal good is a good for which

1. there are very few complements.
2. demand decreases when income increases.
3. demand increases when income increases.
4. there are few substitutes.

59. If income decreases or the price of a complement rises

1. there is an upward movement along the demand curve for the good.
2. there is a downward movement along the demand curve for the good.
3. the demand curve for a normal good shifts leftward.
4. the demand curve for a normal good shifts rightward.

60. A complement is a good

1. used in conjunction with another good.
2. used instead of another good.
3. of lower quality than another good.
4. of higher quality than another good.