If demand increased and supply decreased then:
Quantity exchanged might rise or fall and price would rise
Quantity exchanged would rise and price would fall
Quantity exchanged would rise and price might rise or fall
Both quantities exchanged and price would rise
Correct Answer :
A. Quantity exchanged might rise or fall and price would rise
If demand increases and supply decreases, then both curves will shift in the upward direction. Price will surely rise, but quantity may increase or decrease.}
Related Questions
The proportional demand curve in monopolistic competition (also in kinked demand curve model), is like industry demand curve in:
Monopolistic competition
Imperfect competition
Monopoly
Perfect competition
At the point where the straight line from the origin is tangent to the TC curve, AC is:
Maximum
Minimum
Equal
Lower
If less is demanded at the same price or same quantity demanded at a lower price, it is a case of:
Contraction of demand
Decrease in demand
Increase in demand
Extension of demand
The budget constraint equation of the firm is:
In a competitive market, price is determined primarily by:
Transportation costs
The interplay of demand and supply
Costs of production
The marginal product of labour
The effects according to which people use those goods which are concerned with distinctive standard of living are:
Bandwagon effects
Snob effects
Veblen effects
Steven effects
A shift in the demand for a product is likely to result from a change in:
The products price
Expectations
The prices of factors of production used to produced it
Production technology
If the production increases under decreasing returns to scale, the cost will:
Increase at decreasing rate
Increase at constant rate
Decrease at increasing rate
Increase at increasing rate
Total variable cost curve:
Steps downwards at first and then upwards
Steps upwards, then remains constant and then falls
Steps downwards
None of the above
If both demand and supply were to increase then:
Quantity exchanged would fall and price would rise
Quantity exchanged and price would both fall
Quantity exchanged would rise and price might rise or fall
Quantity exchanged and price would both rise
In the short-run, in which one of the following situations would a competitive seller close down (shut-down)?
When he cannot produce at an economic profit
When price falls short of average variable cost at every level of output
When price falls short of average fixed cost at every level of output
When price falls short of average total cost at every level of output
The factors of production in perfect competition are:
Stagnant
Mobile
Immobile
Rare
The difference between accounting profits and economic profits is:
Implicit costs
Explicit costs
Fixed costs
Variable costs
A monopoly producer usually earns:
Abnormal profits
Only normal profits
Neither profits nor losses
Profits and losses which are uncertain
In monopoly, when average revenue curve falls:
MR constant
MR rises
MR falls
MR is zero
In economic term water is a:
Free good
Economic good
Both of the above
None of the above
A straight line, downward-sloping demand curve implies that, as price falls, the elasticity of demand:
Increases
Decreases
Remains the same
Is zero
Identify the economist who first developed the theory of income determination in its modern form:
Paul A.Samuelson
J.M.Keynes
Joan Robinson
Dr.mehboob ul Haq
Marginal Productivity Theory deals with the theory of:
Distribution
Exchange
Market structure
Consumer behaviour
For the equilibrium of the firm and the industry in the short period in a competitive market, the condition is:
P = AC
P = MC
AC = MC
MC = TR
Marginal utility means:
Utility derived from the last unit of production
Utility derived from the last unit of a commodity which is being consumed
Total utility- Average utility
None of the above
If the marginal utility of apples to a consumer exceeds that of bananas then the consumer:
Is not in equilibrium
Will not buy any banana
Will buy some banana but less than he buys of apples
Is willing to pay more for apples than bananas
The concept of industry in monopolistic competition has been replaced by:
Firm
Product group
Producers
Shopkeepers
7.In an economy based on the price system the decision on what shall be produced is made by:
Government
Consumer
Producer
Stock holder
If Marginal Utility (MU) is zero, then total utility is:
Maximum
Minimum
Infinite
Not measureable
The longer the period of time, the elasticity of supply will be:
Constant
Less elastic
More elastic
Perfectly elastic
On all points of budget (price) line:
Total expenditures increases
Total expenditures decreases
Total expenditures are zero
Total expenditures remain same
Supply of a commodity refers to:
Total stock of a commodity in the market
Total production of a commodity during the year
Total production plus total stock of a commodity
Amount of commodity offered for sale at some price at a particular place and time
According to classical approach, utility can be:
Ranked
Consumed
Expressed in numbers
Cannot be expressed in numbers
The slutsky demand curve includes:
Income effect
Price effect
Substitution effect
None of the above