(A) Luxury
(B) Necessity
(C) Inferior good
(D) Poor quality necessity
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When cross elasticity of demand is zero, then two goods are:
(A) Compliments
(B) Substitutes
(C) Not related
(D) Perfect compliments
The absolute value of the coefficient of elasticity of demand ranges from:
(A) Minus infinity to Plus infinity
(B) Zero to infinity
(C) One to infinity
(D) All of the above
Demand is elastic when:
(A) Price level is high
(B) More substitutes are available
(C) Income of the consumer is less
(D) All of the above
Coefficient of elasticity of demand is negative. It means:
(A) Consumers sometimes buy negative units of a commodity
(B) Price and quantity demanded move in same direction
(C) Law of demand holds
(D) The two goods are complementary to each other
When there is fall in the price of complementary good and rise in the price of substitute good, it shows:
(A) Decrease in demand
(B) Increase in demand
(C) Contraction in demand
(D) Expansion in demand
When same units are demanded at a higher price, it shows:
(A) Decrease in demand
(B) Increase in demand
(C) Expansion in demand
(D) Contraction in demand
Contraction of demand is shown by:
(A) Upward movement on the demand curve
(B) Downward movement on the demand curve
(C) Rightward shift of the demand curve
(D) Leftward shift of the demand curve