Question # 1

When price is fixed below equilibrium level, there will be

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surplus commodity in the market

shortage of commodity in the market

supply curve will shift

demand curve will shift

Price of a product is determined in a free market

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by demand for the product

by supply of the product

by both demand and supply

by the government

An increases in the price of mutton provides information which

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tells consumers to buy more mutton

tells consumers to buy more chicken

tells producers to produce more mutton

b and c of above

Extension of supply will take place as a consequence of:

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Change in price

Change in population

Change in technology

Change in money supply

When the supply curve of a product is parallel to the vertical axis, it would mean that;

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Different quantities of a product are supplied at the same price.

Different quantities of a product are supplied at different price.

Same quantities of a product are supplied at different price.

None of three

If equilibrium price rises but equilibrium quantity is unchanged, the cause is

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supply and demand both increase equally

supply and demand decrease equally

supply curve is vertical and demand increases

supply increases and demand is same

If equilibrium price rises but equilibrium quantity remains unchanged, the cause is

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supply and demand both increase equally

supply and demand both decrease equally

supply decreases and demand increases

supply increases and demand decreases

The price and sales of sugar both increase. What could be the cause of this?

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a decrease in the income of the consumers.

a decrease in the tax on sugar

An increase in the wages of workers in the sugar industry

An increase in the price of sugar substitutes

Which one will be termed as supply of a product.

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One tone potato in cold storage

One ton rice offered for sale in market

One ton rice brought for sale in market at a certain price.

None of the three

If we know that quantities bought and sold are equal, we can conclude that

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quantities demanded and supplied are also equal

the market is in equilibrium

there will be no tendency for a price change

all of the above

Markets where firms supply goods and services demanded by households are

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factor market

product market

open markets

resource markets

One of the following is not an assumption of law of supply.

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Political system should not changed

Cost of production should not changed

Production technique should not changed

Cost of raw material should not changed

In market equilibrium, supply is vertical line. The downward sloping demand curve shifts to the right. Then

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price will fall

price remains same

price will rise

quantity rises

Demand and supply forces determine market price

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only in perfect competition

only in monopoly market

in both markets

none of the above

If price is set above equilibrium level, there will be

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surplus commodity in the market

shortage of commodity in the market

supply curve will shift

demand curve will shift

A change in price brings in quantity supplied. it will be.

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Rise in supply

Contraction of supply

Fall in supply

Extension of supply

With an increase in cost of production, price of the product rises while supply of the product will.

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Fall

Rise

Remain unchanged

Non of the three

Ten rupees is the equilibrium price for good Z. If govt. fixes price at Rs. 5, there is

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a shortage

a surplus

excess supply

loss

Equilibrium

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is a state that can never be achieved in economics

is an important idea for predicting economics changes

is a stable condition

is an unstable condition

When there is big change in quantity supplied resulting from a minor change inits price,its elasticity of supply will be.

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Equal to unity

Less than unity

Equal to zero

Greater than unity

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