The Demand for goods or services is defined as the desire of a consumer

to purchase that commodity. The Supply of goods or services is the

overall availability of that commodity in the market. These two forces
influence the market economy of a particular product, industry or even a
nation.
Below is a list of multiple-choice questions and answers on Demand and
Supply

1. Normally the demand curve will have a _______________

shape.
a. Upward sloping
b. Downward sloping
c. Vertical
d. Horizontal

2) Which of the following is an assumption made while drawing

the demand curve?

a. The demand curve must be linear

b. The price of substitutes should not change
c. The quantity demanded should not change
d. The price of the commodity should not change

3)The elasticity for the demand of durable goods is __________.

a. Zero
b. Equal to unity
c. Greater than unity
d. Less than unity

4)Law of demand shows a relation between the ___________.

a. Quantity demand and quantity supply of a commodity

b. Income and quantity demand of a commodity
c. Price and quantity of a commodity
d. Income and price of a commodity

5)If the quantity demanded of a commodity is unresponsive to

change in prices, then the demand of that commodity is ________.

a. Perfectly inelastic
b. Elastic
c. Unit elastic
d. Inelastic
6) When the price of a product falls by 10% and its demand rises
by 30%, then the elasticity of demand is _________.

a. 13
b. 3
c. 10
d. 30

7)When the elasticity of demand for a commodity is very low, it

shows that the product ________.

a. Has little importance in the total budget

b. Is a luxury
c. Is a necessity
d. None of the above

8)Which of the following is not a cause of the shift in demand for a

product?

a. Change in the price of substitutes

b. Change in the income of a consumer
c. Change in the price of a product
d. None of the above

9)When the demand for a product is perfectly inelastic, a price

increase will result in __________.

a. A decrease in quantity demanded of the product

b. No change in the total income from a product
c. An increase in the total income from a product
d. A reduction in the total income from a product

10)In case the price of a product and the total revenue from that
product move in the same direction, then the demand is
____________.

a. Perfectly elastic
b. Inelastic
c. Elastic
d. Unrelated

11)Would an increase in demand for a product cause the supply

curve to shift in any direction?
a. No effect on supply
b. Change in the slope of a supply curve
c. The supply curve will move to the right
d. The supply curve will move to the left