Question # 1

Demand for a commodity means

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Desire to purchase

Power to purchase

Price of commodity

All the three

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

Id demand changes by less than 10% due to 10% change in price, then elasticity of demand is called

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Equal to unity

More than unity

Less than unity

Infinite

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

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Equal to unity

More than unity

Less than unity

Zero

Supply curve moves from left to right upward, this tendency is called

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Negative

Positive

Horizontal

Vertical

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

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Rise of supply

Extension of supply

Fall of supply

Contraction of supply

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

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Equilibrium price increases

Equilibrium price decreases

Equilibrium price does not change

Equilibrium quantity decreases

If the ratio of change in demand is equal to the ratio of change in price, elasticity of demand will be

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More than unity

Less than unity

Equal to unity

Infinite

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

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

If supply increase due to increase in price, it is called

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Extension of supply

Contraction of supply

Rise of supply

Fall of supply

Non elastic demand curve is

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positive

negative

vertical

horizontal

If quantity demanded for a commodity changes due to the change in income, it is called

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Price elasticity

Point elasticity

Cross elasticity

Income elasticity

If demand decreases by 10% 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

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

Elasticity of demand for durable goods is

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More elastic

Less elastic

Infinte

Zero

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

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