Q.1
A change in the price of a good causes people to buy more or less of an item. This best describes the concept of
  • the demand curve
  • change in quantity demanded
  • change in demand
  • elasticity
Q.2
As prices for a product decrease, demand for a product should increase..
  • diminishing marginal utility
  • elasticity
  • income effect
  • law of demand
Q.3
The more of a product that you consume, the less satisfaction the consumer enjoys..
  • income effect
  • diminishing marginal utility
  • demand elasticity
  • purchasing power
Q.4
The more money that a person makes, the more they are willing to spend..
  • diminishing marginal utility
  • substitute effect
  • total revenue
  • income effect
Q.5
According to the Law of Demand, when prices drop...
  • demand will also drop
  • demand will increase
  • quantity demanded is unchanged
  • supply increases
Q.6
When prices rise for a particular product, consumers will purchase lower-priced similar items..
  • income effect
  • substitute effect
  • diminishing marginal utility
  • law of demand
Q.7
The basic problem of economics is ___.. we just don't have the resources to take care of ALL of our wants/needs!
  • opportunity cost
  • diminishing marginal utility
  • purchasing power
  • scarcity
Q.8
A product may be amazing, but unless people can actually afford it, it's not really in deman.
  • True
  • False
Q.9
An oil refinery fire could cause the price of gas to __
  • increase
  • decrease
  • stabilize
  • fluctuate wildly
Q.10
Law of demand will be applicable only if:a. No change in price of related commodities.b. No Change in Population.c. Alterations in Supplyd. Change in Income of the consumer
  • a & b
  • a, b & d
  • b & d
  • All of the Above
Q.11
Other things remaining the same, the amount demanded increases with a fall in price and diminishes with a rise in price.
  • Is it true for Law of Demand
  • It is incorrect for the Law of Demand
  • It is true for Law of Supply
  • It is incorrect for the Law of Supply
Q.12
An example of Substitute goods could be:
  • Car and Fuel
  • Mobile Phone and Charging cable
  • Butter and Jam
  • Bread and Butter
Q.13
Demand can be defined as the quantity of a product that consumers are able and willing to purchase
  • at a particular price
  • during a specified period of time provided
  • other things remain constant
  • All of the above
Q.14
Pizza and a Burger would be an example for
  • Complementary Goods
  • Substitute Goods
  • Both
  • Neither
Q.15
In a market economy, who decides on the prices of goods and services?
  • government
  • buyers and sellers
  • firms
  • local leaders
Q.16
When consumers react to an increase in a good's price by consuming less of that good and more of other goods.
  • Cost Effect
  • Income Effect
  • Substitution Effect
  • Inflationary Effect
Q.17
Assume that good A and good B are substitutes for each other. Andrea is currently consuming the utility-maximizing combination of these two goods.How will the marginal utility of good A (MUA) and marginal utility of good B (MUB) change if Andrea alters her consumption as a result of an increase in the price of Good B?
  • MUB will increase and MUA will decrease as the consumer reallocates consumption.
  • MUA will increase and MUB will decrease as the consumer reallocates consumption.
  • MUA and MUB will both definitely increase.
  • MUA and MUB will both definitely decrease.
  • MU will both increase, but the MUA will increase by more than the increase in MUB.
Q.18
Meeps and Blops are two goods that are related to each other. When the price of Meeps goes down, the demand for Blops goes down.Based only on the information given here, what kind of goods are Meeps and Blops?
  • substitutes
  • normal goods
  • complements
  • superior goods
  • inferior goods
Q.19
Which of the following correctly describes a change in quantity demanded and a change in demand?
  • A change in quantity demanded is a response to a price change and a change in demand is a response to a non-price change
  • A change in demand and a change in quantity demanded both happen in response to price changes
  • Both describe a movement along a single demand curve
  • The two terms can be used interchangeably
  • A change in quantity demanded occurs when price increases and a change in demand occur when a price decreases
Q.20
Which of the following best describes the 'law of demand'?
  • When price increases, the quantity demanded decreases.
  • Demand decreases for a normal good when income increases.
  • Legal authorities regulate prices.
  • People demand the same amount of a good no matter its price.
  • Sellers set the price that demanders pay.
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