McqMate
| Q. |
A fall in demand or rise in supply of a commodity— |
| A. | Increases the price of that commodity |
| B. | decreases the price of that commodity |
| C. | neutralizes the changes in the price |
| D. | determines" the price elasticity |
| Answer» B. decreases the price of that commodity | |
|
Explanation: The four basic laws of supply and demand are: (1) If demand increases and supplyremains unchanged, a shortage occurs, leading to a higher price: (2) If demand decreases and supply remains unchanged, a surplus occurs, leading to a lower price; (3) If demand remains unchanged and supply increases, a surplus occurs, leading to a lower price; and (4) If demand remains unchanged and supply decreases, a shortage occurs, leading to a higher price. |
|
View all MCQs in
Economics (GK)No comments yet