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Elasticity MCQs

Free 20+ Elasticity MCQs for PPSC, FPSC, NTS, and Pakistan government job tests. Practise below with answers and explanations.

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Elasticity — MCQs for Pakistan government job tests

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Elasticity

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1.What type of good is indicated when the income elasticity of demand is negative?

2.When a manufacturing plant has unused capacity, how is the firm's supply curve most likely characterized?

3.When technological advancements in agriculture cause the supply curve for agricultural products to shift rightward, what is the likely effect on the total revenue earned by farmers?

4.When the supply curve shifts leftward (a reduction in supply), under which condition will the total revenue in the market rise?

5.What does it imply if the supply curve of a product is price elastic?

6.Which of the following goods or services tends to have the least sensitive demand to price changes?

7.Typically, a demand curve that is relatively flat tends to be which of the following?

8.How is the price elasticity of demand best defined?

9.What is the likely effect on demand if consumers believe there are very limited alternatives to a product?

10.For a linear demand curve, how does the price elasticity of demand vary along the curve?

11.In a small town, the cable TV service has 30,000 subscribers when the monthly fee is Rs 30. If the company increases the monthly charge to Rs 40, the subscriber count drops to 20,000. At which monthly price does the cable provider generate the highest total revenue?

12.In Small Town, the cable TV subscription price increases from Rs 30 to Rs 40 per month, causing the number of subscribers to drop from 30,000 to 20,000. Using the midpoint formula, what is the price elasticity of demand for cable television in this town?

13.What is the value of the price elasticity of supply when supply is price inelastic?

14.If consumers consistently allocate 15% of their income to purchasing food, what is the income elasticity of demand for food?

15.When a rise in the price of a product does not change the total revenue, what can be inferred about the demand for that product?

16.If a fisherman is required to sell his entire daily catch immediately at whatever price is offered before the fish spoil, what is the price elasticity of supply for his fresh fish?

17.What type of relationship exists between two products if their cross-price elasticity is negative?

18.Which factor would result in the demand curve for a product being price inelastic?

19.Typically, what characteristic is associated with a demand curve that is relatively flat?

20.When a slight rise in the price of a product causes a significant drop in the quantity demanded, how is the demand for that product classified?

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