Description : Elasticity of demand is the degree of responsiveness of demand of a commodity to a - (1) change in consumers' wealth (2) change in the price of substitutes (3) change in consumers' tastes (4) change in its price
Last Answer : (4) change in its price Explanation: The elasticity of demand, also known as price elasticity of demand, is the degree of responsiveness of demand to change in price. Its measure depends upon comparing ... demand is the ratio of percentage change in amount demanded to a percent-age change in price.
Description : Elasticity of demand measures the responsiveness of the quantity demanded of a goods to a (1) change in the price of the goods (2) change in the price of substitutes (3) change in the price of the complements (4) change in the price of joint products
Last Answer : (1) change in the price of the goods Explanation: Price elasticity of demand is a measure of responsiveness of the quantity of a good or service demanded to changes in its price. This measure of ... good with respect to the change in the price of some other good, a complementary or substitute good.
Last Answer : change in the price of the goods
Description : Engel's Law states the relationship between - (1) quantity demanded and price of a commodity (2) quantity demanded and price of substitutes (3) quantity demanded and tastes of the consumers (4) quantity demanded and income of the consumers
Last Answer : (4) quantity demanded and income of the consumers Explanation: Engel's law is an observation in economics stating that as income rises, the proportion of income spent on food falls, even if ... consumers increase their expenditures for food products (in % terms) less than their increases in income.
Description : Engel’s Law states the relationship between (1) quantity demanded and price of a commodity (2) quantity demanded and price of substitutes (3) quantity demanded and tastes of the consumers (4) quantity demanded and income of the consumers
Last Answer : quantity demanded and income of the consumers
Description : Price elasticity of demand shows the relationship between demand for a commodity and (a) price of other commodities (b) price of that commodity © tastes and preferences of the consumer (d) income of the consumer
Last Answer : (b) price of that commodity
Description : Price elasticity of demand provides A.A measure of the responsiveness of the quantity demanded to changes in the price of the product, holding constant the values of all other variables in the demand function ... the firm C.A technical change in the cost of product D.Technical change in the value.
Last Answer : A.A measure of the responsiveness of the quantity demanded to changes in the price of the product, holding constant the values of all other variables in the demand function.
Description : A fall in demand or rise in supply of a commodity— (1) Increases the price of that commodity (2) decreases the price of that commodity (3) neutralizes the changes in the price (4) determines" the price elasticity
Last Answer : (2) decreases the price of that commodity Explanation: The four basic laws of supply and demand are: (1) If demand increases and supply remains unchanged, a shortage occurs, leading to a higher ... (4) If demand remains unchanged and supply decreases, a shortage occurs, leading to a higher price.
Description : A fall in demand or rise in supply of a commodity– (1) Increases the price of that commodity (2) decreases the price of that commodity (3) neutralises the changes in the price (4) determines the price elasticity
Last Answer : decreases the price of that commodity
Description : Cross elasticity of demand between two perfect substitutes will be A.low B.high C.zero D.infinity
Last Answer : D.infinity
Description : Extension or contraction of quantity demanded of a commodity is a result of a change in the - (1) unit price of the commodity (2) income of the consutner (3) tastes of the consumer (4) climate of the region
Last Answer : (1) unit price of the commodity Explanation: Demand for a commodity refers to the quantity of the commodity that people are willing to purchase at a specific price per unit of time, other factors ... In other words, higher the price, lower the demand and vice versa, other things remaining constant.
Description : Extension or contraction of quantity demanded of a commodity is a result of a change in the (1) unit price of the commodity (2) income of the consumer (3) tastes of the consumer (4) climate of the region
Last Answer : unit price of the commodity
Description : Price elasticity demand of product will be more elastic if it (a) Has no substitutes ; (b) Has number of substitutes ; (c) Is an item of necessity; (d) Is life saving Product
Last Answer : ; (b) Has number of substitutes ;
Description : Change in consumers tastes and preference causes – of the particular goods (a) Change in quantity demanded ; (b) Shift in demand curve ; (c) Change in price ; (d) No effect on quantity demanded
Last Answer : (b) Shift in demand curve ;
Description : The income elasticity of demand being greater than one, the commodity must be - (1) a necessity (2) a luxury (3) an inferior good (4) None of these
Last Answer : (2) a luxury Explanation: In economics, income elasticity of demand measures the responsiveness of the demand for a good to a change in the income of the people demanding the good, ceteris paribus. It is ... If the elasticity of demand is greater than 1, it is a luxury good or a superior good.
Description : The income elasticity of demand being greater than one, the commodity must be (1) a necessity (2) a luxury (3) an inferior good (4) None of these
Last Answer : a luxury
Description : The value of a commodity expressed in terms of money is known as - (1) Price (2) Utility (3) Value (4) Wealth
Last Answer : (1) Price Explanation: The exchange value of every commodity can be expressed in terms of money. This possibility has enabled money to become a medium for expressing values when the growing elaboration of ... . Thus, price can be defined as exchange value of a commodity expressed in terms of money.
Description : The value of a commodity expressed in terms of money is known as (1) Price (2) Utility (3) Value (4) Wealth
Last Answer : Price
Description : Elasticity of demand measures the responsiveness of the quantity demanded of a good to a?
Last Answer : Change in the price of the good
Description : Price elasticity of demand is not affected by (a) Nature of the commodity ; (b) Availability of close substitute; (c) Cost of production ; (d) Consumption habits
Last Answer : (c) Cost of production ;
Description : The Law of Demand expresses - (1) effect of change in price of a commodity on its demand (2) effect of change in demand of a commodity on its price (3) effect of change in demand of a commodity over the supply of its substitute (4) (4) None of the above
Last Answer : (1) effect of change in price of a commodity on its demand Explanation: The law of demand states the inverse relation that comes to exist of between price in one hand and quantity demanded on ... quantity demanded. In other words, the higher the price of a product, the lower the quantity demanded.
Description : )When percentage change in demand for a commodity is less than percentage change in its price, then demand is said to be - (1) Highly elastic (2) Inelastic (3) Relatively elastic (4) Perfectly inelastic
Last Answer : (2) Inelastic Explanation: When the percentage change in quantity demanded is less than the percentage change in price, then the demand for the commodity is said to be inelastic. Price elasticity of demand refers to the degree of responsiveness of quantity demanded to change in price.
Description : When percentage change in demand for a commodity is less than percentage change in its price, then demand is said to be (1) Highly elastic (2) Inelastic (3) Relatively elastic (4) Perfectly inelastic
Last Answer : Inelastic
Description : The Law of Demand expresses (1) effect of change in price of a commodity on its demand (2) effect of change in demand of a commodity on its price (3) effect of change in demand of a commodity over the supply of its substitute (4) None of the above
Last Answer : effect of change in price of a commodity on its demand
Description : A demand curve will not shift: (1) When only income changes (2) When only prices of substitute products change (3) When there is a change in advertisement expenditure (4) When only price of the commodity changes
Last Answer : (4) When only price of the commodity changes Explanation: In economics, the demand curve is the graph depicting the relationship between the price of a certain commodity and the amount of it that ... only when there is a change in other determinants of demand, other than price of the commodity.
Description : If the change in demand for a commodity is at a faster rate than change in the price of the commodity, the demand is - (1) perfectly inelastic (2) elastic (3) perfectly elastic (4) inelastic
Last Answer : (3) perfectly elastic Explanation: If quantity demanded changes by a very large percentage as a result of a tiny percentage change in price, then the demand is said to be perfectly elastic ... in this extreme case would be undefined but it approaches negative infinity as demand becomes more elastic.
Last Answer : When only price of the commodity changes
Description : If the change in demand for a commodity is at a faster rate than change in the price of the commodity, the demand is (1) perfectly inelastic (2) elastic (3) perlectly elastic (4) inelastic
Last Answer : perlectly elastic
Description : The difference between the price the consumer is prepared to pay for a commodity and the price which he actually pays is called (1) Consumer's Surplus (2) Producer's Surplus (3) Landlord's Surplus (4) Worker's Surplus
Last Answer : (1) Consumer's Surplus Explanation: Consumer surplus is the difference between the maximum price a consumer is willing to pay and the actual price they do pay. If a consumer would be willing to pay ... price, then they are getting more benefit from the purchased product than they spent to buy it.
Description : The excess of price a person is to pay rather than forego the consumption of the commodity is called - (1) Price (2) Profit (3) Producers' surplus (4) Consumer's surplus
Last Answer : (3) Producers' surplus Explanation: Producer Surplus' is an economic measure of the difference between the amount that a producer of a good receives and the minimum amount that he or she would be ... or surplus amount, is the benefit that the producer receives for selling the good in the market.
Description : The difference between the price the consumer is prepared to pay for a commodity and the price which he actually pays is called (1) Consumer’s Surplus (2) Producer’s Surplus (3) Landlord’s Surplus (4) Worker’s Surplus
Last Answer : Consumer’s Surplus
Description : The excess of price a person is to pay rather than forego the consumption of the commodity is called (1) Price (2) Profit (3) Producers’ surplus (4) Consumer’s surplus
Last Answer : Producers’ surplus
Description : Price elasticity of demand of a product will be more inelastic if (a) It forms a major part of consumer house hold budget; (b) It forms a very small part of consumers household budget; (c) It is inferior ; (d) It is for mass consumption
Last Answer : (b) It forms a very small part of consumers household budget;
Description : The price elasticity of demand is the: a. percentage change in quantity demanded divided by the percentage change in price b. percentage change in price divided by the percentage change in ... in price d. percentage change in quantity demanded divided by the percentage change in quantity supplied
Last Answer : a. percentage change in quantity demanded divided by the percentage change in price
Description : The demand for which of the following commodity will not rise in spite of a fall in its price? (1) Television (2) Refrigerator (3) Salt (4) Meat
Last Answer : (3) Salt Explanation: For certain goods called necessities, demand is not related to income. Demand for salt does not increase with the increase in income & does not decrease with the decrease in ... irrespective of income. The demand curve slopes downward for goods like salt, but it is inelastic.
Last Answer : Salt
Description : When price of a substitute of commodity falls, the demand for - (1) falls (2) remains unchanged (3) increases at increasing rate (4) rises
Last Answer : (1) falls Explanation: Cross Price Effect refers to effect on the demand for a given commodity due to a change in the price of a substitute commodity. A change (increase or decrease) in the ... the given commodity (tea) also decreases. It shifts the demand curve of the given commodity towards left.
Description : 'Law of demand' implies that when there is excess demand for a commodity, then (1) price of the commodity falls (2) price of the commodity remains same (3) price of the commodity rises (4) quantity demanded of the commodity falls
Last Answer : (3) price of the commodity rises Explanation: The Law of demand states that the quantity demanded and the price of a commodity are inversely related, other things remaining constant. That is, if ... of the commodity the price starts rising and it continues to rise till equilibrium price is reached.
Description : When the price of a commodity falls, we can expect - (1) the supply of it to increase (2) the demand for it to fall (3) the demand for it to stay constant (4) the demand for it to increase
Last Answer : (4) the demand for it to increase Explanation: In economics, the law of demand is an economic law, which states that consumers buy more of a good when its price is lower and less when its ... of good demanded by the consumer will be negatively correlated to the change in the price of the good
Description : The relationship between price of a commodity and the demand for it - (1) is a positive relationship (2) is an inverse relationship (3) They are independent of each other (4) They do not have any relationship
Last Answer : (2) is an inverse relationship Explanation: According to the Law of demand, consumers buy more of a good when its price is lower and less when its price is higher. It states that the quantity demanded and the prices of a commodity are inversely related, other things remaining constant.
Description : The equilibrium price of a commodity will definitely rise if there is a/an: (1) increase in supply combined with a decrease in demand. (2) increase in both demand and supply. (3) decrease in both demand and supply. (4) increase in demand accompanied by a decrease in supply.
Last Answer : (4) increase in demand accompanied by a decrease in supply. Explanation: Price of a commodity is always determined by the forces of demand and supply in the market. The price at which ... equilibrium price definitely increases when there is an increase in demand combined with the decrease in supply.
Description : When price of a substitute of commodity ‘x’ falls, the demand for ‘x’ : (1) falls (2) remains unchanged (3) increases at increasing rate (4) rises
Last Answer : falls
Description : The equilibrium price of a commodity will definitely rise if there is a/an : (1) increase in supply combined with a decrease in demand. (2) increase in both demand and supply. (3) decrease in both demand and supply. (4) increase in demand accompanied by a decrease in supply.
Last Answer : increase in demand accompanied by a decrease in supply.
Description : The relationship between price of a commodity and the demand for it (1) is a positive relationship (2) is an inverse relationship (3) They are independent of each other (4) They do not have any relationship
Last Answer : is an inverse relationship
Description : ‘Law of demand’ implies that when there is excess demand for a commodity, then (1) price of the commodity falls (2) price of the commodity remains same (3) price of the commodity rises (4) quantity demanded of the commodity falls
Last Answer : price of the commodity rises
Description : When the price of a commodity falls, we can expect (1) the supply of it to increase (2) the demand for it to fall (3) the demand for it to stay constant (4) the demand for it to increase
Last Answer : the demand for it to increase
Description : A price consumption curve, traces the utility maximizing combination of two goods when (a) the price of one good changes (b) the consumer’s preference change © the consumer’s income changes (d) the demand curve for one of the goods shifts rightward
Last Answer : (a) the price of one good changes
Description : If the disposal income of a household decreases by 10% and the demand for X commodity remains same. The income elasticity of X is (a) 0 ; (b) 0.5 ; (c) 0.5 ; (d) 2.5
Last Answer : (a) 0 ;
Description : If the disposal income of a household increases by 10% and the demand for X commodity increased by 10% the income elasticity of X is (a) 1.5 ; (b) 0.5 ; (c) 1.5 ; (d) 1.0
Last Answer : (d) 1.0
Description : If the disposal income of a household increases by 10% and the demand for X commodity increased by 25%. The income elasticity of X is (a) 1.5 ; (b) -0.5 ; (c) 2.5 ; (d) -2.5
Last Answer : ; (c) 2.5 ;