Question 1

Which of the following best describes the relationship between price and quantity supplied, according to the law of supply?

Accepted Answer

As price increases, quantity supplied increases.

Question 2

Suppose the supply function for a product is given by $ Q_s = 9 + 0.5p $. If the price of the product is $ p = 6 $, what is the quantity supplied?

Accepted Answer

$ Q_s = 15 $

Question 3

Which of the following would cause a shift of the supply curve to the right?

Accepted Answer

A government subsidy for producers.

Question 4

If the demand function is $ Q_d = 12 - p $ and the supply function is $ Q_s = 9 + 0.5p $, what is the equilibrium price?

Accepted Answer

$ p = 6 $

Question 5

Which of the following is NOT a factor that shifts the supply curve?

Accepted Answer

Consumer income

Question 6

A positive demand shock will most likely result in which of the following changes in the market?

Accepted Answer

Increase in equilibrium price and quantity

Question 7

Which scenario best illustrates excess supply (surplus) in a market?

Accepted Answer

Sellers want to sell more but buyers do not want to buy.

Question 8

If the price of a product rises, what is the most likely effect on the quantity supplied, assuming all other factors remain constant?

Accepted Answer

Quantity supplied will increase.

Question 9

Which of the following markets is an example of a stock exchange market?

Accepted Answer

New York Stock Exchange

Question 10

Suppose a government imposes a tax on producers. What is the most likely effect on the supply curve?

Accepted Answer

The supply curve shifts to the left.

Question 11

Given the demand function $ Q_d = 12 - p $ and the supply function $ Q_s = 9 + 0.5p $, what is the equilibrium quantity?

Accepted Answer

$ Q = 15 $

Question 12

Which of the following best describes the equilibrium price in a market?

Accepted Answer

The price at which quantity demanded equals quantity supplied.

Question 13

If technology improves in the production of a good, what is the most likely effect on the supply curve?

Accepted Answer

The supply curve shifts to the right.

Question 14

Which of the following is an example of a demand shock?

Accepted Answer

A sudden increase in consumer income.

Question 15

If the price of other products increases, what is the most likely effect on the supply of a given product?

Accepted Answer

Supply of the given product decreases.

Question 16

Which of the following statements about the supply function is correct?

Accepted Answer

It describes the relationship between quantity supplied, price, and other factors.

Question 17

Suppose there is a positive supply shock in the market. What is the most likely effect on equilibrium price and quantity?

Accepted Answer

Equilibrium price decreases and equilibrium quantity increases.

Question 18

Which of the following best explains why the supply curve is upward sloping?

Accepted Answer

Producers are interested in maximizing profits as higher prices make production more profitable.

Question 19

If the price of a good is below the equilibrium price, what is likely to occur in the market?

Accepted Answer

Excess demand (shortage)

Question 20

Which of the following is NOT an example of a market described in the study materials?

Accepted Answer

Government-run monopoly

Supply and Demand: Core Concepts in Microeconomics

Study Guide - Practice Questions