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Supply and Demand
Practice MCQs under Supply and Demand. 81 available
Questions
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Correct options are highlighted when revealed.
1.
What is the typical shape of a demand curve?
Flat (horizontal) line
Straight vertical line
Slopes downward from left to right
Slopes upward from left to right
2.
What term describes a company earning profits beyond its normal profit level?
Profit calculated after considering opportunity costs
Revenue minus explicit costs
Minimum profit required to keep resources employed
Excess profit over and above normal profit
None of the above
3.
How does an increase in marginal cost affect output, and how does an increase in marginal revenue impact output?
decreases; decreases
decreases; increases
increases; increases
increases; decreases
no change; no change
4.
Marginal revenue refers to the ________ resulting from producing an additional ________ of output.
Variation in average revenue when output rises
Change in total revenue from selling one more unit
Difference in average revenue after increasing output by one unit
Increase in total revenue as output grows
Change in fixed costs with an increase in production
5.
What are firms generally assumed to do with their costs and profits?
bear, seek
cover, generate
allocate, obtain
reduce, increase
manage, sustain
6.
What term describes the added satisfaction gained from consuming an additional unit of a product?
Marginal utility
Incremental satisfaction
Excess benefit
Supplementary pleasure
None of the above
7.
What does the opportunity cost for a student represent?
The expenses for tuition and accommodation
Money borrowed from a financial institution
The income foregone from the best possible job by choosing to study instead
The salary expected after completing the degree
8.
What is the expected effect on your demand for goods if both your income and the prices of those goods double?
Rise
Remain the same
Fall
Move to a different level
Fluctuate unpredictably
9.
Which term describes the responsiveness of the quantity demanded to changes in consumer income?
Demand sensitivity to price changes
Elasticity measuring demand response to related goods' prices
Elasticity related to consumer budget adjustments
Elasticity reflecting demand variation with income shifts
None of the above
10.
What is the effect of a rise in consumption levels on aggregate supply or demand?
Cause aggregate supply to increase
Cause aggregate supply to decrease
Cause aggregate demand to increase
Cause aggregate demand to decrease
No effect on aggregate supply or demand
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