Question # 1

Finance minister in order to increase the public revenue imposes the tax on the commodities whose demand is more elastic

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At low rate

At high rate

Some times decreases the rate and some times increases

Does not change Tax rate

Due to fall in demand, curve shifts to

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Right

Left

Both sides

None of these

When there are small and minor changes in price and demand then

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Price elasticity

Income elasticity

Cross elasticity

Point elasticity

Elasticity of demand for durable goods is

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More elastic

Less elastic

Infinte

Zero

Demand for basic necessities of life is:

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Perfectly elastic

Less elastic

Perfectly inelastic

More elastic

Cause of positive slope of supply curve

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Change in cost of production

Fear of increase in cost of production and decrease in profit

Change in technique of production

Increase in per unit profit due to increase in price

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

Desire + Purchasing power is equal to:

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Demand

Supply

Income

Utility

The goods which are jointly demanded to satisfy a want, are called

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Complimentary goods

Substitute goods

Alternative goods

inferior goods

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

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Equal to unity

More than unity

Less than unity

Infinite

Finance minister in order to increase the public revenue, imposes tax on the commodities whose demand is less elastic

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At low rate

At high rate

Some times decreases the tax rate and some times increases the tax rate

Does not change tax rate

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 demand curve shifts leftward (or downward), it is called

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Rise of demand

Fall of demand

Extension of demand

Contraction of demand

Due to rise in demand, demand curve shifts to

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Right

Left

Both sides

None of these

Demand for Giffen goods is:

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Negative

Vertical

Positive

All of them

If supply rises more proportionately than that of demand, then

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Equilibrium price increases

Equilibrium price decreases

Equilibrium price does not change

Equilibrium quantity decreases

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