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Supply and Demand Formative Assessment

Last updated about 7 years ago

10 questions

Note from the author:

Economics Supply and Demand

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Question 1

1.

Which of the following is represented by the graph above?

increase in demand

increase in quantity demanded

decrease in demand

decrease in quantity demanded

Question 2

2.

Which of the following is the best example of the law of demand?

a consumer buys more shoes when the price increases

a consumer purchases more shoes when they go on a "buy-one-get-one" sale

a consumer purchases more shoes when his income rises

a consumer purchases more shoes when he finds a style he really likes

Question 3

3.

The expectation of a sale on a good/service in the future is most likely to lead to which of the following right now?

increase in quantity demanded

decrease in quantity demanded

increase in demand

decrease in demand

Question 4

4.

Which of the following would likely cause the shift shown above in the market for avocados?

Avocado-growing regions experienced a severe drought and crop disease.

New research shows that avocados are good for heart health.

New fertilizer leads to large avocado crop.

American incomes fall for the third month in a row.

Question 5

5.

Assume that chips and salsa are COMPLEMENTARY goods, meaning they are used together. How will the market for chips be affected if the price of salsa DECREASES to $1 per bottle?

Demand for chips will be unchanged.

Demand for chips will increase.

Supply of chips will increase.

Demand for chips will decrease.

Question 6

6.

Which of following is the best example of the Law of Supply?

a producer supplies a greater quantity of products as the price increases.

a consumer buys fewer products are price increases.

a producer supplies a smaller quantity of products as the price decreases.

a consumer buys less products as the price decreases.

Question 7

7.

Which of the following headlines would cause the shift shown on the graph above in the market for cars?

American incomes rise.

New technology makes car production more efficient.

More mass transit replaces the need for personal vehicles.

Steel, a resource used in making cars, doubles in price

Question 8

8.

A decrease in taxation on businessess production would most likely lead to

an increase in quantity supplied

a decrease in quantity supplied

an increase in supply

a decrease in supply

Question 9

9.

The movement from P1, Q1 to P2, Q2 in the image above is best described as

an increase in quantity supplied

a decrease in quantity supplied

an increase in supply

a decrease in supply

Question 10

10.

Claire's Bakery can produce 48 cookies per hour. Claire, the bakery owner, buys a new convection oven. As a result of this new technology, the bakery can now produce 192 cookies per hour.

How would an economist model the change in Claire's businesses>

movement to the right along the supply curve

movement to the left along the supply curve

the entire supply curve shifts to the right

the entire supply curve shifts to the left