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Markets And Prices Quiz 4 (24 MCQs)

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1. The price elasticity of demand for a good made by a firm is-0.6. If the firm raises the price of the good, its revenues will

2. Adam Smith encourages a market economy to limit the role of the government, because when the government interferes in the economy there is a negative impact on

3. As price for a good or service goes up, how does that typically affect the quantity supplied?

4. Income elasticity of demand is positive when demand and income change in the same direction. A positive YED indicates that the good in question is _____

5. A new company in town creating the same product as you would cause _____

6. The income elasticity of demand for bus travel is-1.5. This means that

7. In the summer picnic season, a sharp rise in the price of burgers may lead to an increase in the demand for the substitute good, _____

8. What is it called when the government uses some tool other than money to allocate resources?

9. A price floor typically creates _____

10. In which stage of the product life cycle, would a business cut prices to attract competitors' customers to purchase its products?

11. Which one of the following measures of elasticity indicates that two goods are substitutes

12. A competitive market is characterized by _____

13. If a manufacturer/producer sets the price too high _____ (choose the one that is FALSE)

14. A demand curve is drawn on the assumption that

15. The cross elasticity of demand between goods X and Y is positive. This implies that they are

16. In a typical demand schedule, quantity demanded

17. An established minimum price that buyers must pay for a good or service is known as what?

18. 'Price high-Sales volume low and high profit margins'. This strategy occurs in what kind of market?

19. Two goods with a XED of +0.7 are _____ for each other than two goods with a XED of +0.3.

20. In a mass market, the price will be what?

21. At a given price, the amount by which quantity supplied exceeds quantity demanded yields a _____

22. If you have a shift right of supply due to improvements in technology, then _____

23. The Law of Demand states that as quantity demanded decreases _____

24. When there is an increase in prices, which of the following would a buyer be motivated to do?

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Markets And Prices Quiz 4 (24 MCQs)

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