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.Management Sciences
Category: Supply and Demand
Demand for a normal product may shift outwards if ?
A. Price decreases
B. The price of a substitute falls
C. The price of a complement rises
D. income falls
The Setrite Corporation produce chairs. An economist working for the firm predicts that if people’s incomes rise next year, then the demand for our chairs will for our chairs will increase ceteris paribus The accuracy of the economist’s prediction depends on whether the chairs Setrite Produce ?
A. have few substitutes.
B. are normal goods
C. have few complementary goods.
D. have many complementary goods.
Aggregate demand will increase if ?
A. consumption falls
B. investment falls
C. Exports fall
D. imports fall
Adding up the quantities demanded of a good by different people facing the same price gives us the ?
A. Supply curve
B. Market demand curve
C. Demand curve
D. Market supply curve
For an inferior good ?
A. The price elasticity of demand is negative: the income elasticity of demand is negative
B. The price elasticity of demand is positive the income elasticity of demand is negative
C. The price elasticity of demand is negative the income elasticity of demand is positive
D. The price elasticity of demand is positive the income elasticity of demand is positive
Profits are maximized when ?
A. costs are minimized
B. revenue is maximized
C. average cost is less than average revenue
D. marginal cost equals marginal revenue
When the market operates without interference, price increases will distribute what is available to those who are willing and able to pay the most. This process is known as ?
A. Quantity setting
B. price fixing
C. price rationing
D. quantity adjustment.
A fall in price ?
A. Will cause an inward shift of demand
B. Will cause an outward shift of supply
C. May be caused by a fall in demand
D. Leads to a higher level of production
Which of the following would decease aggregate demand ?
A. increase consumption
B. increasing export revenue
C. increased taxation revenue
D. increased investment
An increase in price all other things unchanged leads to ?
A. Shift demand outwards
B. Shift demand inwards
C. A contractions of demand
D. An extension of demand
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