ECO401 Quiz

Question # 1 of 15 ( Start time: 03:42:56 PM ) Total Marks: 1

The shape of production possibilities curve is:

Select correct option:

            Concave.

            Convex.

            Linear.

            Positive.

Question # 2 of 15 ( Start time: 03:43:23 PM ) Total Marks: 1

The percentage change in quantity demanded given a percentage change in consumer's income is known as:

Select correct option:

            Price elasticity of demand.

            Income elasticity of demand.

            Supply price elasticity.

            Cross price elasticity.

Question # 3 of 15 ( Start time: 03:43:55 PM ) Total Marks: 1

Demand is said to be ---------------- when the elasticity of demand is less than 1.

Select correct option:

            Increasing

            Decreasing

            Elastic

            Inelastic

Question # 4 of 15 ( Start time: 03:44:16 PM ) Total Marks: 1

We know that the demand for a product is elastic if:

Select correct option:

            When price rises, revenue rises.

            When price rises, revenue falls.

            When price rises, quantity demanded rises.

            When price falls, quantity demanded rises.

Question # 5 of 15 ( Start time: 03:44:50 PM ) Total Marks: 1

If the income elasticity of demand is 1/2, the good is:

Select correct option:

            A luxury.

            A normal good (but not a luxury).

            An inferior good.

            A Giffen good.

  

Question # 6 of 15 ( Start time: 03:45:05 PM ) Total Marks: 1

If the equilibrium price of bread is Rs. 3 and the government imposes Rs. 2 price ceiling on the price of bread then:

Select correct option:

            More bread will be produced to meet the increased demand.

            There will be a shortage of bread.

            The demand for bread will decrease because suppliers will reduce their supply.

            A surplus of bread will emerge.

Question # 7 of 15 ( Start time: 03:45:25 PM ) Total Marks: 1

If utility remains the same for original and new combination of goods consumed, the effect of a change in the price of a good on the quantities consumed will be called as:

Select correct option:

            Substitution effect.

            Real income effect.

            Income effect.

            Budget effect.

Question # 8 of 15 ( Start time: 03:46:10 PM ) Total Marks: 1

Which of the following is true about the point on a nation's production-possibilities curve?

Select correct option:

            It shows an undesirable combination of goods and services.

            It shows the combinations of production that are unattainable, given current technology and resources.

            It shows the level of production that will cause both unemployment and inflation.

            It shows that resources are fully employed in producing a particular combination of goods and services.

Question # 9 of 15 ( Start time: 03:46:44 PM ) Total Marks: 1

In a free-market economy, the allocation of resources is determined by:

Select correct option:

            Votes taken by consumers.

            A central planning authority.

            Consumer preferences.

            The level of profits of firms.

 

Question # 10 of 15 ( Start time: 03:46:58 PM )            Total Marks: 1

At the equilibrium price:

Select correct option:

            There will be a shortage.

            There will be neither a shortage nor a surplus.

            There will be a surplus.

            There are forces that cause the price to change.

Question # 11 of 15 ( Start time: 03:47:38 PM )            Total Marks: 1

A schedule which shows the various amounts of a product consumers are willing and able to purchase at each price in a series of possible prices during a specified period of time is called:

Select correct option:

            Supply Scedule.

            Demand Scedule.

            Quantity supplied Scedule.

            Quantity demanded Scedule.

Question # 12 of 15 ( Start time: 03:48:28 PM )            Total Marks: 1

Suppose price rises from Rs. 15 to Rs. 17 and quantity demanded decreases by 20%. We can conclude:

Select correct option:

            Demand is inelastic.

            The elasticity of demand is 2.

            Total revenue will decrease.

            Demand is unit elastic.

Question # 13 of 15 ( Start time: 03:49:19 PM )            Total Marks: 1

While drawing a given market demand curve,---------------- is not considered constant.

Select correct option:

            Income.

            The price of the good in question.

            The prices of related goods.

            Preferences.

 

   

Question # 14 of 15 ( Start time: 03:49:48 PM )            Total Marks: 1

The effect of a change in income on the quantity of the good consumed is called the:

Select correct option:

            Income effect.

            Budget effect.

            Substitution effect.

            Real income effect.

Question # 15 of 15 ( Start time: 03:50:07 PM )            Total Marks: 1

What is the reason of leftward shift in the demand curve for product A?

Select correct option:

            A decrease in income if A is an inferior good.

            An increase in income if A is a normal good.

            An increase in the price of a product that is a close substitute for A.

            An increase in the price of a product that is complementary to A.