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Economics multiple choice questions

GCSE and O level

Demand, Supply and Equilibrium

Multiple Choice Questions and Answers

Drought in African countries often results in poor harvests

Other countries then help by sending quantities of food

What are the likely results of these events for the price of food in the drought-affected countries?

A It will fall and then rise
B It will rise and continue to rise
C It will rise and remain at this higher level
D It will rise and then fall {N11/P1/Q9]

Answer is D

What is not held constant in constructing a demand schedule?

A the incomes of consumers
B the prices of complementary goods
C the price of the good itself
D the tastes of consumers [J12/P1/Q6]

Answer is C

Many countries buy oil from Saudi Arabia which change is most likely to lead to a fall in the price of a barrel of oil?

A an increase in the demand of 10% with no change in supply
B with an increase an in demand of 10%
C No change in the demand with a 10% decrease in supply
D Nochange in demand with a a 10% increase in supply[J13/P1/Q6]

Answer is D

In 2011, a company selling milk in glass bottles replaced them with new plastic bottles When they were introduced, the equilibrium quantity on the market fell What could be a reason for this fall?

A Consumers preferred the new bottle because it was lighter to carry
B Milk from the farms used to fill the bottle cost more
C The bottle was cheaper than the existing glass bottle to produce
D The new bottle was introduced with a successful advertising campaign [N13/P1/Q6]

Answer is B

Which will encourage domestic producers to grow more maize?

A granting subsidies to maize producers
B increasing the sales tax on maize
C prices for maize
D removing quotas on imported maize IN13/P1/Q9]

Answer is A

A supply curve shows the link between the quantity supplied and

A demand
B equilibrium output
C the price of the product
D the scale of production [J14/P1/Q4]

Answer is C

In 2011 the US Government declared that the country must increase the manufacture of fuel from crops such as corn that have previously only been used for food What is likely to happen in the market for corn?

A a movement along the demand curve for corn
B a movement along the supp’ curve for corn
C a shift to the left in the demand curve for corn
D a shift to the left in the supply curve for corn [J14/P1/Q7]

Answer is B

What is meant by the equilibrium quantity in the market for a product?

A the average quantity produced over the year
B the average quantity sold over
C the year the quantity at which profit occurs
D the quantity at which the demand and supply curves intersect(N14/P1/Q5]

Answer is D

What is meant by an equilibrium price?

A a government price that ensures fairness for all
B a price that has no pressure to rise or fall
C a price that maximises the profits of the producers
D a price that maximises the satisfaction of the consumers{N15/P1/Q5]

Answer is B

A government taxes the production of cars What is likely to decrease?

A the cost of supplying cars
B the price of cars
C the revenue for the government
D the supply of cars at every price[J16/P1/Q4]

Answer is D

The market for a good was in equilibrium. A change occurred which resulted in a new equilibrium with a higher price for the good and a lower quantity traded What change would have caused this?

A the demand curve moved to the left
B the demand curve moved to the right
C the supply curve moved to the left
D the supply curve moved to the right [N16/P1/Q4]

Answer is C

A demand curve shows the relationship between the quantity demanded and

A a change in income
B consumer tastes
C the supply of the product
D the price of the product (N16/P1/Q5)

Answer is D

A government subsidises the production of pineapples This is likely to

A increase the price of pineapples
B raise the costs of supplying pineapples
C raise revenue for the government
D cause the supply of pineapples to increase at every price [N16/P1/Q6]

Answer is D

In 2015 there was a significant fall in the world price of petrol (gasoline) What would not have been a cause of the price fall?
A the continuing global recovery from the world economic recession
B the increasing exploitation of US oil reserves
C the re-entry of Iranian producers to the world oil market
D the shorter journeys from using the new Suez Canal(J17/P1/Q7]

Answer is A

Petrol (fuel) retailers in a country have noticed a sharp increase in sales in August when many people take their holidays Why might this take place?

A Consumers’ demand curve for petrol shifts to the left in August
B Consumers’ demand curve for petrol shifts to the right in August
C oil refineries increase their outpost in august
D Travel companies increase their hotel prices in August (N18/P1/Q11)

Answer is B

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