PRACTICE PROBLEMS - DEMAND AND SUPPLY CURVES

  1. If the price of orange juice goes up, what happens to the demand for apple juice?
  1. Increases
  2. decreases
  3. Stays the same

  1. If the price of milk goes down, what happens to the demand for cereal?
  1. increases
  2. decreases
  3. Stays the same

  1. If cigarette companies increase the price of cigarettes, what will happen to their revenue?
  1. Increase
  2. Decrease
  3. Neither

  1. Cars are a(n):
  1. Normal good
  2. Inferior good
  3. Neither
  4. Both

  1. Ramen noodles are a(n):
  1. Normal good
  2. Inferior good
  3. Neither
  4. Both

  1. If a company increases the price of an inelastic good, their revenue will:
  1. Increase
  2. Decrease
  3. Stay the same

  1. If a company increases the price of an elastic good, its revenue would:
  1. Increase
  2. Decrease
  3. Stay the same

  1. The price of apple juice has gone up. At the same time, the price of oranges used to make orange juice has gone down. What will be the effect on the price and quantity of orange juice.
  1. The price will increase, but the effect on quantity is ambiguous.
  2. The effect on the price is ambiguous, but the quantity will increase
  3. The price will decrease, but the effect on the quantity is ambiguous
  4. The effect on the price is ambiguous, but the quantity will decrease