Question # 1

If percentage change in supply is less than the percentage change in price, then elasticity of supply is called

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Equal to unity

Less than unity

More than unity

Zero

Exceptions, or limitations of law of demand have been stated by

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Professor Marshall

Professor Adam Smith

Professor Benham

Professor Robbins

If demand does not change, then due to fall of supply

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Equilibrium price increases

Equilibrium price decreases

Equilibrium quantity increases

If demand falls more proportionately then that of supply then

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Equilibrium price increases

Equilibrium price decreases

Equilibrium price does not change

Equilibrium quantity increases

Kinds of supply according to period of time are

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Two

Three

Four

Five

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

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Point elasticity

Arc elasticity

Cross elasticity

Income elasticity

If supply of a commodity changes by less than 10% due to a 10% change in its price, then elasticity of supply will be

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Equal to unity

More than unity

Less than unity

Zero

Rise of supply can be shown with the help of

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A supply curve

More than one supply curves

Fixed supply curve

Vertical supply curve

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

If supply curve is vertical (parallel to y-axis), then elasticity of supply is

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Zero

Infinite

Equal to unity

More than unity

If quantity demand changes due to the change in income, it is called:

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Point Elasticity of demand

Arc Elasticity of demand

Income Elasticity of demand

Price Elasticity of demand

Market equilibrium is determined when

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Demand = supply

Demand > supply

Demand < supply

Demand = zero

Elasticity of demand for substitute and jointly demanded goods is called

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Income elasticity

Arc elasticity

Cross elasticity

Point elasticity

If demand decreases by 15% due to 10% increase in Price, then elasticity of demand is

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Equal to unity

More than unity

Less than unity

Zero

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

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

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