Tag: economics

Quizzes (361) Questions (3598)

Questions Related to economics

Multiple choice economics theory of supply elasticity of supply supply - law of supply and price elasticity of supply law of supply and elasticity of supply
The supply of durable goods is usually _____________.

  1. more elastic

  2. less elastic

  3. perfectly elastic

  4. perfectly inelastic
Reveal answer Fill a bubble to check yourself
A Correct answer
Explanation

Durable goods can be stored over time, allowing producers to adjust their supply more easily in response to price changes compared to perishable goods. Thus, their supply is generally more elastic.

Multiple choice economics theory of supply elasticity of supply supply - law of supply and price elasticity of supply law of supply and elasticity of supply
If ${E} _{s}=0.6$, and the percentage change in price $=5$, then percentage change in quantity supplied is ______.
  1. $8.33$
  2. $4.4$
  3. $5.6$
  4. $3$
Reveal answer Fill a bubble to check yourself
D Correct answer
Explanation

Elasticity of supply = (Percentage change in quantity) / (Percentage change in price). Given Es = 0.6 and % change in price = 5, then % change in quantity = 0.6 * 5 = 3.

Multiple choice economics theory of supply elasticity of supply supply - law of supply and price elasticity of supply law of supply and elasticity of supply

Write True or False with a reason.
In the long period, elasticity of supply tends to be lower than in the short period.

  1. True

  2. False
Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

False. Longer the time period, greater will be the elasticity of supply. Because, over a long period of time, more and more factors are easily available and their input can be changed to increase (or decrease) output of the commodity.

Multiple choice economics theory of supply elasticity of supply supply - law of supply and price elasticity of supply law of supply and elasticity of supply

Write True or False with a reason.
${E} _{s}=1$ only if supply curve forms a $\angle {45}^{o}$ at the origin. Is it true?

  1. True

  2. False
Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

While a 45-degree line through the origin has an elasticity of 1, it is not the only case. Any straight-line supply curve passing through the origin has an elasticity of 1, regardless of the specific angle, as long as it is linear and originates from (0,0).

Multiple choice economics theory of supply elasticity of supply supply - law of supply and price elasticity of supply law of supply and elasticity of supply

Write True or False with a reason.
If a straight line upward sloping supply curve shoots from the origin, elasticity of supply is always equal to one.

  1. True

  2. False
Reveal answer Fill a bubble to check yourself
A Correct answer
Explanation

True. When a straight line upward sloping supply curve passes through the origin (no matter what the angle it forms), the elasticity of supply is equal to one.