Demand and Supply-2

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31. Personal disposable income is-
(A) Always equal to personal income
(B) Always more than personal income
(C) Equal to personal income minus direct taxes paid by household
(D) Equal to personal income minus indirect taxes
Ans. (C)

32. Who said ‘Supply creates its own demand”?
(A) Adam Smith
(B) J.B. Say
(C) Marshall
(D) Ricardo
Ans. (B)

33. Speculative demand for cash is determined by-
(A) The rate of interest
(B) The level of income
(C) The general price level
(D) The market conditions
Ans. (A)

34. What is needed for creating demand?
(A) Production
(B) Price
(C) Income
(D) Import
Ans. (C)

35. Effective demand depends on-
(A) Capital output ratio
(B) Output capital ratio
(C) Total expenditure
(D) Supply price
Ans. (D)

36. The supply-side economics lays greater
emphasis on-
(A) Producer
(B) Global economy
(C) Consumer
(D) Middle Man
Ans. (A)

37. When price of a substitute of commodity ‘x’ falls, the demand for ‘x’–
(A) Falls
(B) Remains unchanged
(C) Increases at increasing rate
(D) Rises
Ans. (A)

38. J.B Say’s Law of Market was not accepted by:
(A) Adam Smith
(B) Marshall
(C) Malthus
(D) David Ricardo
Ans. (C)

39. The time element in price analysis was introduced by-
(A) J.M. Keynes
(B) Alfred Marshall
(C) J.S. Mill
(D) J.R. Hicks
Ans. (B)

40. When the demand for a good increases with an increase in income, such a good is called_________ .
(A) Superior good
(B) Giffen good
(C) Inferior good
(D) Normal good
Ans. (A)

41. If demand curve for camping tents is D = 100000 – 17P and supply curve is S = 50000 + 8P, find the equilibrium Price?
(A) Rs. 1000
(B) Rs. 2000
(C) Rs. 4000
(D) Rs. 500
Ans. (B)

42. If price of an article decreases from P1 to Rs unit25, quantity demanded increases from 900 s to 1200 units. If point elasticity of demand is 2 find P1?
(A) Rs. 20
(B) Rs. 30
(C) Rs. 35
(D) Rs. 15

43. A company faces a -2.5 price elasticity of demand for its product. It is presently selling 10,000 units/month. If it wants to increase quantity sold by 6%, itmust lower its price by-
(A) 3.50%
(B) 15%
(C) 2.50%
(D) 2.40%
Ans. (D)

44. If price of an article decreases from Rs. 12 to Rs. 10, quantity demanded increases from 1000 units to 1400 units. Find point elasticity of demand?
(A) 2.4
(B) -2
(C) -2.4
(D) 2
Ans. (A)

45. A manufacturer faces price elasticity of demand of a – 2 for its product. If it lowers it price by 5%, the increase in quantity sold will be-
(A) 3%
(B) 10%
(C) 2.50%
(D) 7%
Ans. (B)

46. If demand curve for a fishing rod is D = 37000 – 11P and supply curve is S = 12000 + 9P, find the equilibrium quantity ?
(A) 1250 units
(B) 23250 units
(C) 52350 units
D) 2500 units
Ans. (B)

47. If price of an article decreases from Rs. 25 to quantity demanded increases from Q1 untis to 1500 units. If point elasticity of demand is – 1.25, find Q1 ?
(A) 900 units
(B) 1200 units
(C) 2000 units
(D) 1800 units
Ans. (B)

48. Calculate a country’s GDP if for the year consumer spending is $400 mi ll ion, government spending is $150 investment by businesses is $80 million, exports are $35 million and imports are $40 million.
(A) $625 million
(B) $465 million
(C) $475 million
(D) $635 million
Ans. (A)

49. If price of an article decreases from Rs P1 to Rs 75, quantity demanded increases from 1000 units to 1200 units. If point elasticity of demand is 3.2 find P1?
(A) Rs 85
(B) Rs 80
(C) Rs 90
(D) Rs 95
Ans. (B)

50/kg. If the government sets a price floor of Rs 70/kg then____.
(A) Quanity fo sugar demanded will be greater than the quantity demanded at equilbrium price
(B) There will be a shortage of sugar in the market
(C) There will be a surplus of sugar in the market.
(D) Quantity of sugar supplied will be less than what was supplied at the equilibrium price
Ans. (C)

30P and supply is 5=4000+40P,What is the euilibrium Price?
(A) 50
(B) 100
(C) 150
(D) 200
Ans. (B)

52. If demand curve for racing cycles is D = 59600 – 6P and supply curve is S = 29600 + 4P, find the equilibrium Quantity?
(A) 118000
(B) 300
(C) 41600
(D) 6000
Ans. (C)

53. If demand curve for racin[SSC CHSL 2017] Exp: Equilibriug cycles is D = 80200 13P and supply curve is S = 6200 + 12P, What is the equilibrium Quantity?
(A) 2960 units
(B) 31220 units
(C) 8750 units
(D) 41720 units
Ans. (D)

54. A manufacturer faces a -1.2 price elasticity of demand for its product. It is presently selling 7,500 units/day. If it wants to increase quantity sold by 9%, it must lower its price by
(A) 7.5 percent
(B) 7.8 percent
(C) 10.2 percent
(D) 10 percent
Ans. (A)

55. If demand curve for trekking boots is D = 67500 – 18P and supply curve is S = 22500 + 12P, find the equilibrium Price?
(A) 1500
(B) 750
(C) 2250
(D) 500
Ans. (A)

56. A manufacturer faces price elasticity of demand of a 1.25 for its product. If it lowers its price by 6.4%, the increase in quantity sold will be _____.
(A) 5.15 percent
(B) 7.65 percent
(C) 8 percent
(D) 5.12 percent
Ans. (C)

57. If quantity of good X demanded increases from 4000 units to 5000 units when price of good Y increases from Rs 75 to Rs 90, find Arc Cross elasticity of demand?
(A) 0.55
(B) 1.66
(C) 0.25
(D) 1.22
Ans. (D)

58. Find arc elasticity of demand,if quantity demanded falls from 750 unit to 650 unit when price of the item is increased from Rs 15 to Rs 20?
(A) 0.5
(B) -0.5
(C) -2
(B) 2
Ans. (A)

59. In Which stage of the business cycle the inventory stock will be the highest?
(A) Boom
(B) Depression
(C) Recession
(D) Recovery
Ans. (B)

60. If price of an article decreases from Rs 800 to Rs 700, quantity demanded increases from Q1 units to 70 units. nIf point elasticity of demand is -1.333 find Q1?
(A) 80 units
(B) 90 units
(C) 60 units
(D) 50 units
Ans. (C)

61. Increase in the demand for a good will cause the equilibrium price of the good to ________ and theequilibrium quantity to _________.
(A) Increase~ increase
(B) Decrease~ decrease
(C) Increase~ decrease
(D) Decrease~ increase
Ans. (A)

62. If quantity of a good demanded increases from 200 to 250 then the average income of the population
increases from Rs 20,000 to Rs 30,000, find Arc ncome elasticity of demand?
(A) 1.45
(B) 0.55
(C) 2
(D) 1.25
Ans. (B)

63. If demand curve for an electric tooth brush isD = 25000 – 7P and supply curve is S = 10000 +8P, find theequilibrium Price?
(A) Rs 150
(B) Rs 1000
(C) Rs 400
(D) Rs 50
Ans.(B)

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