Demand Supply and Equilibrium MCQ

Class 12
Revision Worksheet
Topic Demand, Supply and Equilibrium Price
Multiple Choice Questions



Name __________________________

Class ________________

Teacher Name _____________________


Q1 The following might influence the demand for a good. Which would not cause a shift in the
demand curve for the product?

A. a change in the price of a complement
B. a change in the price of the good itself
C. a change in the price of a substitute
D. a change in consumers’ incomes


Q2 A fall in the price of online music downloads from sites such as iTunes and growing popularity for services such as Wynk results in a fall in the demand for music CDs. This result implies thatthese products are
A. Are in joint demand
B. Are in joint supply
C. Are produced by business involved in a cartel
D. Are substitute products

Q3 A major determinant of demand in one particular market would be
A. the technique of production
B. the number of sellers in the market
C. the incomes of buyers in that market
D. the cost of raw materials

Q4 Which of the following will result in a shift in the demand curve for motorcycles?
A. a subsidy paid to producers of motorcycles
B. higher raw material and component prices in the production of motorcycles
C. falling petrol and diesel prices
D. higher motorcycle prices

Q5 Which of the following would shift the supply curve for housing in Pitam Pura to the right?
A. an increase in mortgage interest rates
B. the release of more land for housing development in the suburbs around Pitam Pura
C. an increase in the cost of construction materials
D. an increase in speculative demand for properties in Pitam Pura

Q6 Unfavourable climatic conditions in the major fruit-growing areas in Spain are most likely to lead to
A. an increase in demand for fruit and increased prices
B. an increase in supply of fruit and decreased prices
C. a decrease in demand for fruit and decreased prices
D. a decrease in supply of fruit and increased prices

Q7 The law of demand is that there is an [A]__________ relationship between the price of a good
and demand. As prices fall we see an [B]__________ of demand. If price rises there should be
a [C]___________ of demand


Q8 Substitutes are goods in [A]___________ demand and act as replacements for another product



Q9 Oil is a substitute for coal. If the price of oil increases, then
A. the demand curve for coal will shift to the right
B. the quantity of coal demanded will decline
C. the supply curve for coal will shift to the right
D. the equilibrium price and quantity of coal will not change

Q10 Suppose the government reduces subsidies paid to dairy farmers. The most likely effect on the
price of dairy products would be
A. an increase as there would be a decrease in the supply of milk
B. a decrease as there would be a decrease in demand for milk
C. an increase as there would be an increase in demand for milk
D. a decrease as there would be an increase in the supply of milk

Q11 As a result of a substantial increase in wages paid to carpenters, we would expect that the price
of new houses would
A. decrease as there would be an increase in the supply of new housing due to higher
production costs
B. increase as there would be a decrease in the supply of new housing due to higher production
costs
C. increase as there would be an increase in the demand for new housing across the
community
D. decrease as there would be a decrease in the demand for new housing across the
Community

Q12 Assume that coal is a normal good. If the price of coal increases and the quantity sold increases, which of the following is consistent with these observations?
A. The demand curve for coal is upward sloping
B. New regulations are imposed on the coal mining industry
C. The price of oil increased, oil and coal being substitutes
D. New machinery made coal mining more efficient

Q13 The diagrams show how a shift in demand for good X results in a shift in the demand for good Y.
Which of the following pairs of goods is most likely to be represented by good X and good Y?
A. Coca-Cola and Pepsi-Cola
B. The Times of India and The Hindustan newspapers
C. Rail travel and air travel
D. iPads and software applications (apps)


Q14 As consumers have become more concerned about the amount of saturated fat in their diet, the
demand for fresh chicken has increased whilst the demand for fried chicken nuggets has fallen.
The result of this is likely to be
A. A rise in the market price of fried chicken nuggets
B. An increase in the quantity supplied of fried chicken nuggets
C. A decrease in the quantity supplied of fresh chicken
D. A rise in the market price of fresh chicken

Q15 An increase in the price of fresh vegetables will most likely result from
A. an increase in the price of a complementary product
B. a decrease in the price of a substitute product
C. a decrease in the price of fertilisers used in vegetable growing
D. flooding affecting farmers during the harvesting season

Q16 The diagram shows the demand and supply curves for bricks. Which one of the following might
explain the shift in the supply curve from Rs 1 to Rs 2?
A. A fall in the demand for new homes
B. A rise in the cost of materials used in making bricks
C. A fall in mortgage interest rates
D. A government subsidy to brick producers






Q17




The diagram shows the market supply and demand for wine. The rightward shift in the supply
curve for wine might have been caused by
A. A fall in the rate of value added tax applied to wine producers
B. A fall in demand for wine
C. The creation of a cartel among wine producers designed to maximise profits
D. A rise in the wages of people employed by wine vineyards


 Q18  The diagram shows the market demand curve for tomatoes. Assuming OP1 to be the original
equilibrium price, a decrease in price to OP2 could have been caused by a decrease in
A. the productivity of workers employed by tomato producers
B. the price of substitutes for tomatoes
C. the tax on employing workers in the tomato industry
D. real incomes in the economy (assume tomatoes are a normal good)






Q19 The diagram shows the market for asparagus. The initial equilibrium position is indicated by point X.
Following a successful advertising campaign for asparagus and a sustained period of rain which
damaged the asparagus crop, what would be the new equilibrium point (A, B, C or D)?
A. A
B. B
C. C
D. D


Q20 The diagram shows the demand for and supply of flights to the United Arab Emirates (UAE) from
the India
The government raises taxes on flights out of the United Kingdom, whilst a recession affects the
demand for business and tourist flights. (Both business and tourist travel are assumed to be
normal goods)
If the initial equilibrium point is X, which of the following points, A, B, C, D shows the likely new
equilibrium point for the flights?
A. A
B. B
C. C
D. D




Answer Key

Q1
Q2
Q3
Q4
Q5
Q6
Q7
Q8
Q9
Q10










Q11
Q12
Q13
Q14
Q15
Q16
Q17
Q18
Q19
Q20












Score Card
Total Attempted

Total Left

Correct

Wrong


For suggestions, queries, feedback and discussion do feel to connect me
Pankaj Bhanwani
#9899971997
#pankajbhanwani@gmail.com

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@Pankaj Bhanwani

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