Market equilibrium occurs when:
A) Quantity demanded is greater than quantity supplied
B) Quantity supplied is greater than quantity demanded
C) Quantity demanded equals quantity supplied
D) Price is fixed by the government
The equilibrium price is the price at which:
A) The demand curve intersects the supply curve
B) The demand curve shifts to the right
C) The supply curve shifts to the left
D) There is a shortage of goods
If the price of a good is above the equilibrium price, there will be:
A) A shortage
B) A surplus
C) No effect on the market
D) An increase in demand
If the price of a good is below the equilibrium price, there will be:
A) A shortage
B) A surplus
C) No effect on the market
D) An increase in supply
The point at which the quantity demanded equals the quantity supplied is called:
A) The price ceiling
B) The price floor
C) The equilibrium point
D) The market price
A shift in the demand curve to the right, with supply held constant, will result in:
A) A decrease in equilibrium price
B) An increase in equilibrium price
C) No change in price
D) An increase in quantity supplied
A shift in the supply curve to the left, with demand held constant, will result in:
A) A decrease in equilibrium price
B) An increase in equilibrium price
C) No change in price
D) A decrease in quantity demanded
When both demand and supply increase simultaneously, equilibrium quantity will:
A) Increase
B) Decrease
C) Remain unchanged
D) Become indeterminate
If the government imposes a price ceiling below the equilibrium price, the result will be:
A) A surplus
B) A shortage
C) No effect on the market
D) An increase in production
A price floor set above the equilibrium price will lead to:
A) A shortage
B) A surplus
C) No effect on the market
D) An increase in demand
The law of demand states that:
A) Price and quantity demanded are directly related
B) Price and quantity demanded are inversely related
C) Price and quantity supplied are inversely related
D) Price and quantity demanded are unrelated
If the price of a good rises, the quantity demanded typically:
A) Increases
B) Decreases
C) Remains constant
D) Becomes inelastic
If the price of a good falls, the quantity demanded typically:
A) Increases
B) Decreases
C) Remains constant
D) Becomes elastic
In a market with a price floor, if the floor is set below the equilibrium price:
A) There is no effect
B) There will be a shortage
C) There will be a surplus
D) Price will rise to the equilibrium level
Which of the following is a characteristic of a market in equilibrium?
A) The market experiences a surplus
B) The market experiences a shortage
C) The quantity supplied equals the quantity demanded
D) Price exceeds consumer willingness to pay
A change in which factor will not affect market equilibrium?
A) Consumer preferences
B) Income levels
C) Government taxes
D) Weather conditions
In the case of a price ceiling, if the ceiling is set above the equilibrium price, there will:
A) Be no effect
B) Be a shortage
C) Be a surplus
D) Be an increase in supply
In a perfectly competitive market, if the price is above the equilibrium price:
A) There will be a shortage
B) There will be a surplus
C) Prices will rise
D) The demand curve will shift left
What happens when there is a simultaneous increase in both supply and demand?
A) Equilibrium quantity remains unchanged
B) Equilibrium price is indeterminate
C) Equilibrium quantity decreases
D) Equilibrium price increases
If the supply of a good decreases and demand remains constant, the equilibrium price will:
A) Decrease
B) Increase
C) Remain unchanged
D) Become indeterminate
Which of the following factors would most likely cause a rightward shift of the demand curve?
A) A decrease in the price of a substitute good
B) A decrease in consumer income
C) An increase in consumer preferences for the good
D) A decrease in the population size
If the price of a good is set below the equilibrium price, the result will be:
A) A surplus of the good
B) A shortage of the good
C) No change in quantity demanded or supplied
D) The market will automatically adjust
If a market is experiencing a shortage, what will most likely happen to the price?
A) The price will decrease
B) The price will remain constant
C) The price will increase
D) The price will become fixed
The market mechanism is most effective in achieving:
A) Price stabilization
B) Equilibrium between supply and demand
C) A price floor
D) A price ceiling
