Economics Quiz

If demand increases in a market then if supply is upward sloping this will lead to:

• A higher equilibrium price and output

• A lower equilibrium price and higher output

• A lower equilibrium price and output

• A higher equilibrium price and lower output

An increase in customers' incomes will:

• Lead to a movement along the demand curve

• Shift the supply curve

• Shift the demand curve

• Lead to an extension of demand

A reduction in the costs of production will:

• Lead to a movement along the supply curve

• Shift the demand curve

• Shift the supply curve

• Lead to an extension of supply

A shift in supply will have a bigger effect on price than output if demand is:

• Income elastic

• Income inelastic

• Price elastic

• Price inelastic

Assuming a downward sloping demand curve and upward sloping supply curve, a higher equilibrium price may be caused by:

• A fall in demand

• An increase in supply

• Improvements in production technology

• An increase in demand

The imposition of an indirect tax will lead to

• A higher equilibrium price and higher output

• A higher equilibrium price and lower output

• A lower equilibrium price and lower output

• A lower equilibrium price and higher output

A movement along the demand curve may be caused by:

• A change in income

• A change in the number of buyers

• A change in advertising

• A shift in supply

A subsidy paid to producers:

• Shifts the supply curve

• Shifts the demand curve

• Leads to a contraction in supply

• Leads to an extension of supply

A movement along the supply curve may be caused by:

• A change in technology

• A change in the number of producers

• A shift in demand

• A change in costs

A change in the price of a product cannot:

• Act as a signal

• Act as an incentive

• Act as a rationing device

• Shift its demand curve