Demand and Supply Mcqs Test 06 Preparation Online

1. Contraction of demand is the result of?

A. Decrease in the number of consumers

B. Increase in the prices of other goods

C. Increase in the price of the commodity concerned

D. Decrease in the income of purchasers

2. In respect of which of the following category of goods is consumer's surplus highest?

A. Necessities

B. Luxuries

C. Prestige goods

D. Giffen goods

3. In the case of a straight-line demand curve meeting the two axes, the price-elasticity of demand at the mid-point of the line would be?

A. 4

B. 2

C. 3

D. 1

4. The Law of Demand, assuming other things to remain constant, establishes the relationship between?

A. Income of the consumer and the quantity of a commodity demanded by him

B. Price of a commodity and the quantity demanded

C. Quantity demanded of a commodity and the relative prices of its complementary goods

D. Price of a commodity and the demand for its substitute

5. All but one of the following are assumed to remain the same while drawing an individual's demand curve for a commodity. Which one is it?

A. The price of the commodity under consideration

B. The prices of other goods

C. His monetary income

D. The preferences of the individual

6. In the case of an inferior good, the income elasticity of demand is?

A. Infinite

B. Negative

C. Zero

D. Positive

7. Identify the factor which generally keeps the price-elasticity of demand for a commodity now?

A. Variety of uses for that commodity

B. High proportion of the consumer's income spent on it

C. Its low price

D. Close substitutes for that commodity

8. Identify the coefficient of price-elasticity of demand when the percentage increase in the quantity of a commodity demanded is smaller than the percentage fall in its price?

A. Greater than one

B. Pqual to one

C. Small than one

D. Zero

9. Which of the following pairs of commodities is an example of substitutes?

A. Pen and ink

B. Shirt and trousers

C. Tea and sugar

D. Tea and coffee

10. Total utility is maximum when?

A. Marginal utility is at its highest point

B. Average utility is maximum

C. Marginal utility is zero

D. Marginal utility is equal to average

Demand and Supply Mcqs Test 06 Preparation Online

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