This quiz works best with JavaScript enabled. Home > Microeconomics > Prices > Markets And Prices – Quiz 2 🏠 Homepage 📘 Download PDF Books 📕 Premium PDF Books Markets And Prices Quiz 2 (20 MCQs) Quiz Instructions Select an option to see the correct answer instantly. 1. Producers and Consumers in a mixed economy convey information through: A) Lawyers. B) Government. C) Prices. D) Contracts. Show Answer Correct Answer: C) Prices. 2. Price ceilings create a(n) ..... A) Shortage. B) Surplus. C) Equilibrium. D) Shift in the supply curve. Show Answer Correct Answer: A) Shortage. 3. If a price floor is set above the equilibrium price A) It has no effect on quantity supplied. B) A shortage results. C) A surplus results. D) The market forces of supply and demand determine prices. Show Answer Correct Answer: C) A surplus results. 4. This is a system in which the government allocates goods and services using factors other than price. A) Black Market. B) Rationing. C) Free Enterprise. D) None of these. Show Answer Correct Answer: B) Rationing. 5. If you have a temporary shock to supply, then you would logically see ..... A) The price go down. B) The price go up. C) The equilibrium price is the same. D) None of above. Show Answer Correct Answer: B) The price go up. 6. When the quantity that consumers are willing and able to buy equals the quantity that producers are willing and able to sell, that market reaches A) Equilibrium. B) Disequilibrium. C) Market price. D) The shortage price. Show Answer Correct Answer: A) Equilibrium. 7. All of the following reduce demand EXCEPT A) An increase in consumer income. B) A decline in number of consumers. C) An increase in the price of a complement. D) A decrease in price of a substitute. Show Answer Correct Answer: A) An increase in consumer income. 8. Which of the following factors would shift demand for a product? A) # of sellers in a market. B) New technology used to make products. C) Income of buyers. D) A tax placed on a good by the government. Show Answer Correct Answer: C) Income of buyers. 9. A price ceiling typically creates ..... A) A shortage. B) A surplus. C) Equilibrium. D) None of above. Show Answer Correct Answer: A) A shortage. 10. What causes prices to move to reach equilibrium in competitive markets? A) The government. B) The stock market. C) Individual buyers and sellers. D) The Federal Reserve Board. Show Answer Correct Answer: C) Individual buyers and sellers. 11. Customers frequently search online to find the most competitive price for goods and services. Which of the following influences on pricing strategies is most likely to have led to this development? A) Cost of producing the product. B) Legislation. C) State of the economy. D) Technology. Show Answer Correct Answer: D) Technology. 12. Which of the following is NOT a problem with rationing? A) Expensive. B) Unfair. C) Time consuming. D) Difficult. Show Answer Correct Answer: D) Difficult. 13. What is a black market? A) The term for when business is good and profitable. B) The term for when business is losing money. C) When goods and services are exchanged illegally. D) None of above. Show Answer Correct Answer: C) When goods and services are exchanged illegally. 14. What happens to a market in equilibrium when supply increases? A) Excess supply means the producers will make less of the good. B) QD will exceed QS, so price will drop. C) QS will exceed QD, so price will drop. D) Undersupply means that the good will become more expensive. Show Answer Correct Answer: C) QS will exceed QD, so price will drop. 15. What is the name of the smallest amount that can legally be paid to most workers? A) Equilibrium price. B) Supply cost. C) Price floor. D) Minimum wage. Show Answer Correct Answer: D) Minimum wage. 16. If you produce durian chips and dried banana decreases in price, then the price of your durian chips would likely ..... A) Go down. B) Go up. C) The equilibrium price is the same. D) None of above. Show Answer Correct Answer: A) Go down. 17. Adam Smith describes the benefits to all through our selfish or self-interested actions. He calls it ..... A) Laissez Faire. B) Selfishness. C) Market efficiency. D) The invisible hand. Show Answer Correct Answer: D) The invisible hand. 18. In the early stages of the 'growth' phase of the product life cycle, prices are what? A) Generally kept low. B) Maintained at a set level. C) Increased as consumer demand for the product increased. D) Reduced to be the cheapest in the market. Show Answer Correct Answer: C) Increased as consumer demand for the product increased. 19. An established maximum price that sellers may charge for a good or service is known as what? A) Price Ceiling. B) Price Floor. C) Shortage. D) None of these. Show Answer Correct Answer: A) Price Ceiling. 20. An economy in which average incomes have fallen by 5% has also seen the demand for holidays overseas fall by 20%. It can be concluded from this that the income elasticity of demand for holidays overseas is A) +4.0%. B) -4.0%. C) +0.25%. D) -0.25%. Show Answer Correct Answer: A) +4.0%. ← PreviousNext →Related QuizzesMicroeconomics QuizzesMarkets And Prices Quiz 1Markets And Prices Quiz 3Markets And Prices Quiz 4Markets And Prices Quiz 5 🏠 Back to Homepage 📘 Download PDF Books 📕 Premium PDF Books