Demand and supply

University of the West Indies Open Campus Belize City Introduction to Economics Quiz #4

1. Supply of a commodity is:

a. the amount placed on the market b. the number of units sold c. the number of units of a commodity which suppliers are willing and able to offer for sale at a particular price per unit time period d. the quantity supplied on the market by an individual supplier

2. Quantity supplied will be increased by: a. a fall in demand b. a rise in the cost of factors of production c. a rise in price d. a decline in the amount of expected profit

3. If demand deceases and supply increases simultaneously, then price will

a. always increase b. always decrease c. increase only if supply increases more than demand decreases d. decrease only if supply increases more than demand increases

4. Why does a normal supply curve for corn slope upwards from left to right?

a. farmers’ profits increase as price increases b. farmers increase supply following increases in demand c. farmers charge more to cover a rise in the price of seed d. farmers are willing to produce more corn as price increases

5. Which of the following would cause a shift of the supply curve to the right?

a. a decrease in VAT b. a decrease in specific subsidies c. an increase in production costs d. an increase in the price of the product

6. Goods X and Y are in competitive supply. Other things being equal, what will be the effect of a decrease in demand for good Y?

a. an increase in the supply and price of good X b. a decrease in the supply and price of good X c. an increase in the supply and a decrease in the price of good X d. a decrease in the supply and an increase in the price of good X

7. Which of the following will cause the supply curve for peaches to shift to the left?

a. a rise in the price of apples b. a successful advertising campaign for cream c. a reduction in subsidies to fruit growers d. an increase in the total number of consumers of peaches

8. Goods that are in joint supply are:

a. sold together b. consumed together c. produced together d. produced by the same firm

9. Which of the following would cause an expansion in the supply of chicken?

a. a fall in the price of beef b. a rise in the price of chicken c. a rise in vegetarianism d. a rise in the price of chicken feed

10. Reefer to the diagram of the board. In the market shown,

a. point W shows the new equilibrium position b. the new equilibrium price and quantity are both greater than originally. c. an increase in demand has been more than offset by an increase in supply d. the equilibrium position has shifted from W to V

END OF QUIZ.GOOD LUCK!!!!!!!!