Which of the following is an example of substitute goods?

a) Tea and Co ee
b) Coke and Pepsi
c) Car and Petrol
d) Tea and Sugar

The demand for normal goods _______ with an increase in income of the consumer.

a) Increases
b) Decreases
c) Remains same
d) Either increases or decreases

An increase in the price of substitute goods leads to:

a) Expansion in Demand
b) Increase in Demand
c) Decrease in Demand
d) Contraction in Demand

A, B and C are three commodities, where A and B are complementary; Whereas A and C
are substituted with an increase in the price of commodity A:

a) Demand of all the commodities A, B and C will fall

b) Demand of commodities A and B will fall, whereas demand of C will rise
c) Demand of commodities A and C will fall, whereas demand of B will rise
d) Demand of Commodities B and C will fall, whereas demand of A will rise

When two or more goods are demanded simultaneously, it is known as:

a) Joint Demand
b) Alternate Demand
c) Direct Demand
d) Composite Demand

There will be a _ in the demand curve of cars with an increase in the price of petrol:

a) Rightward shift
b) Upward Movement
c) Leftward Shift
d) Downward Movement

The demand curve for a commodity is generally drawn on the assumption that:
a) Prices of substitute goods do not change
b) Tastes and preferences of the consumer remain the same
c) Income of the consumer remains the same
d) All of these

Which one of these is not an example of complementary goods?

a) Tea and Co ee
b) Coke and Pepsi
c) Pen and Refill
d) Bread and Butter

The Law of Demand states the _ relationship between price and quantity demanded.

a) Inverse
b) Positive
c) Proportional
d) None of these

Expansion in demand leads to:

a) Rightward Shift in the demand curve

b) Downward Movement along the demand curve
c) Upward Movement along the demand curve
d) None of these

Which one of these is not a determinant of individual demand?

a) Size and composition of the population

b) Tastes and Preferences
c) Distribution of income
d) All of these

From the given demand schedule, determine the e ect on the demand curve:

Price (₹) 20 20
 Demand (units) 100 70

Options

a) Rightward Shift in the demand curve

b) Leftward Shift in the demand curve
c) Upward Movement along the demand curve
d) Downward Movement along the demand curve

Expansion in demand occurs due to:

a) Rise in price of the given commodity

b) Fall in price of the given commodity
c) Rise in price of substitute goods
d) Fall in price of complementary goods

There is a sudden change in climatic conditions resulting in hot weather. Assuming no

change in the price of the cold drinks, it will lead
to:

a) Upward movement along the same market demand curve

b) Downward movement along the same market demand curve
c) Rightward shift in the market demand curve
d) Leftward shift in the market demand curve

A movement along the demand curve for soft drinks is best described as:

a) Increase in demand
b) Decrease in demand
c) Change in quantity demanded
d) Change in demand

If more is demanded at the same price of same quantity at a higher price, this fact of
demand is known as:

a) Extension of demand
b) Increase in demand
c) Contraction of demand
d) Decrease in demand
Cross demand states the relationship between:

a) Demand of given commodity and price of related goods

b) Demand of given commodity and income of the consumer
c) Demand of given commodity and taste and preferences.
d) None of these

Which of the following is not an assumption of the law of demand?

a) Price of substitute goods do not change

b) Income of the consumers remain the same
c) There is no change in tastes and preferences of the consumers
d) Price of the given commodity does not change

If a change in the price of good A a ects the demand for good B, then:

a) A is a substitute of good B
b) A is a complement of good B
c) Both a) and b)
d) Either a) or b)

In a typical demand schedule, quantity demanded:

a) Varies directly with price

b) Varies proportionately with price
c) Varies inversely with price
d) Is independent of price

Which of the following is a determinant of market demand?

a) Income of the consumers

b) Season and weather
c) Price of related goods
d) All of the above

Which of the following factors will lead to a leftward shift in the demand curve:
a) Increase in income in case of interior goods
b) Increase in income in case of normal goods
c) Decrease in Population
d) Expectation of future increase in price

Decrease in the price of the complementary goods leads to:

a) Upward movement along the same demand curve

b) Downward movement along the same demand curve
c) Rightward shift in the demand curve
d) Leftward shift in the demand curve

If the Price of good ‘X’ rises and it leads to a fall in demand for good ‘Y’, then the two
goods are:

a) Substitute goods
b) Complementary goods
c) Normal goods
d) Interior goods

The market demand curve is obtained by _ summation of the individual demand curves.

a) Vertical
b) Horizontal
c) Both a) and b)
d) Neither a) nor b)

Cateris paribus means:

a) Holding supply constant

b) Holding demand constant
c) Price being constant
d) Other factors being constant

An increase in the real income of a consumer induces him to buy more of a commodity
whose prices have fallen. This is known as:

a) Inducement E ect
b) Substitution E ect
c) Income E ect
d) Utility E ect

Expansion of Demand is associated with:

a) Rise in Price, Rise in quantity demanded

b) Fall in Price, Fall in quantity demanded
c) Fall in Price, Rise in quantity demanded
d) Rise in Price, Fall in quantity demanded

If X and Y are complementary Goods, then with an increase in the price of X:

a) Demand of X will decrease and demand of Y will increase

b) Demand of X will increase and demand of Y will decrease
c) Demand of X and Y will increase
d) Demand of X and Y will decrease

If Tea and Co ee are substitutes, a fall in the prices of Tea leads to:

i) Rise in the demand for Tea

ii) Fall in the demand for Tea
iii) Fall in the demand for co ee
iv) Rise in the demand for co ee

Options

a) Both ii) and iv)

b) Both i) and ii)
c) Both ii) and iii)
d) Both iii) and iv)

All except one of the following are assumed to remain the same while drawing an
individual’s demand curve for a product. Which one is it?

a) Tastes and Preferences of the individual

b) Monetary income
c) Price of the given product
d) Price of related goods
The demand function of a product X is given as Dx = 12 – 2Px, where Px stands for price.
The demand at price of ₹2 will be:

a) 6
b) 8
c) 5
d) 10

With a fall in the price of a commodity, the demand of the commodity increases as it
becomes relatively cheaper in comparison to other commodities.
This e ect is known as:

a) Substitution E ect
b) Income E ect
c) Law of Demand
d) Law of Diminishing Returns

The demand function of a product X is given as Dx = 12 – 2Px, where Px stands for price.
If there are 5,000 customers for the product,
then market demand for the product at a market price of ₹3 will be:

a) 40,000
b) 30,000
c) 20,000
d) 16,000

Two commodities A and B can be inferred as close substitutes of each other if:

a) Rise in price of one leads to an increase in demand of other and vice-versa

b) Rise in price of one leads to a decrease in demand of other and vice-versa
c) Fall in price of one lead to fall in demand of other one, but not the other way around
d) Rise in price of one lead to rise in demand of other one, but not the other way round

Goods can be considered a normal good if an increase in income of the consumer

causes __ in demand of the given good:

a) Increase
b) No change
c) Decrease
d) Less than proportionate increase
Expansion and contraction in demand are caused by:

a) Change in price of the given good

b) Change in income
c) Change in prices of related goods
d) Change in population

When the income of the consumer falls, the impact on the price demand curve of an
inferior good is:

a) Shifts to the right

b) Shifts to the left
c) Shifts to the right
d) There is downward movement along the curve

If due to fall in the price of Good X, demand for good Y rises, the two goods are:

a) Substitutes
b) Complements
c) Not related
d) Competitive

If with the rise in the price of good Y, demand for good X rises, the two goods are:

a) Substitutes
b) Complements
c) Not related
d) Jointly demanded

The slope of the demand curve is generally:

a) Negative
b) Positive
c) Constant
d) Either a) or b)
Any statement about the demand for a good is considered complete only when the
following is/are mentioned in it.

a) Price of the good

b) Quantity of the good
c) Period of time
d) All of the above

Good X and good Y are complementary goods, while good X and good Z are substitute
goods. What will happen to good Y and good Z, if the price
of good X decreases?

a) The demand for both goods, Y and Z will decrease

b) The demand for both goods, Y and Z will increase
c) The demand for good Y will increase and for good Z will decrease
d) The demand for good Y will decrease and for good, Z will increase

Which of the following is a reason for ‘Change in Demand’?

a) Change in Income
b) Change in Price of related goods
c) population increase
d) All of these