Question # 1

If supply decreases due to decrease in price, it is called

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Extension of supply

Contraction of supply

Rise of supply

Fall of supply

In case of rise in demand, demand curve shifts:

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Right side

Downward

Upward

(a) and (c)

Which one of the following is not included in the assumptions of law of supply

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taste of consumer

cost of production

Methods of production

price of raw material

If price of a commodity constant but its supply increases or price decreases but supply remains constant, it is called

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Rise of supply

Fall of supply

Extension of supply

Contraction of supply

If demand curve is parallel to x-axis, then elasticity of demand is

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Infinite

Zero

Equal to unity

More than unity

Stock means the quantity of a commodity

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Which is offered for sale in the market

Which is sold in the market

Total production is called stock

Which the seller keeps in his possession without selling

Supply of durable goods is

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Elastic

Perfectly elastic

Perfectly inelastic

Less elastic

If supply is fixed then due to fall of demand

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Equilibrium price decreases

Equilibrium quantity increases

Equilibrium price increases

Equilibrium price does not change

If the total expenditure of the consumer does not change due to increase or decrease (change) in price, then nature of elasticity of demand will be

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Equal to unity

Less than unity

More than unity

Elasticity of demand = zero

Flux method is also known as:

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Percentage method

Unitary method

Total expenditure method

All of them

When there is big change in demand and price of a commodity, it is called

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Point elasticity

Arc elasticity

Cross elasticity

Income elasticity

Slope of demand curve of exceptions of law of demand is

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Negative

Positive

Zero

Fixed

When supply changes due to other factors besides price, it is called

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Rise of supply

Fall of supply

Rise and fall of supply

Extension and contraction of supply

What is meant by demand for a commodity in economics

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To desire for a commodity

To have power to buy

To have power to buy a commodity with desire

Quantity of a commodity

Supply of goods depends upon

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Price

Income

Price and income

Utility

Cause of shifting of supply curve is

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Change in price

Other factors

Change in tax

Change in income

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Principles of Economics Icom Part 1 English Medium Chapter 3 Online Test MCQs With Answers

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