Market Equilibrium: Interactive Quizzes for Economics BSc Students

Question 1

Identify the defining characteristic of a perfectly competitive market:

Accepted Answer

Presence of many small firms with limited market power

Answer

Dominated by a small number of large firms

Answer

Production of differentiated products

Answer

Barriers to entry and exit

Question 2

What factor does NOT directly shift the equilibrium point in a market?

Accepted Answer

The passage of time

Answer

Changes in consumer preferences

Answer

Government regulations

Answer

Technological advancements

Question 3

In a perfectly competitive market, the equilibrium price and quantity are determined by the:

Accepted Answer

Interaction of supply and demand

Answer

Government intervention

Answer

Market demand only

Answer

Market supply only

Question 4

A shift in the supply curve will result in a:

Accepted Answer

Shift of the equilibrium point

Answer

Movement along the demand curve

Answer

Change in equilibrium price only

Answer

Change in equilibrium quantity only

Question 5

A price ceiling that is set below the equilibrium price will lead to:

Accepted Answer

Excess demand

Answer

Excess supply

Answer

Equilibrium

Answer

No change in quantity supplied

Question 6

Which of the following is a characteristic of a public good?

Accepted Answer

Non-excludable

Answer

Rivalrous

Answer

Provided by the government

Answer

Subject to market equilibrium

Question 7

In a partial equilibrium analysis, we assume:

Accepted Answer

Other markets are unaffected

Answer

The market under study is in equilibrium

Answer

Government intervention is present

Answer

All markets are in equilibrium

Question 8

Welfare economics is concerned with:

Accepted Answer

Measuring and improving societal well-being

Answer

Determining market equilibrium

Answer

Analyzing market failures

Answer

Maximizing producer profits

Question 9

In the context of market equilibrium, a change in consumer preferences may result in:

Accepted Answer

A shift in the demand curve

Answer

A change in the equilibrium price only

Answer

A change in the equilibrium quantity only

Answer

No change in the market equilibrium

Question 10

Which of the following is an example of a negative externality?

Accepted Answer

Pollution released by factories

Answer

Government subsidies for eco-friendly energy sources

Answer

Construction of a new school

Question 11

In a perfectly competitive market, the equilibrium price is determined by the intersection of which two curves?

Accepted Answer

Supply and demand

Answer

Demand and cost

Answer

Supply and cost

Answer

Marginal cost and marginal revenue

Question 12

Which of the following is a welfare loss in a market?

Accepted Answer

Deadweight loss

Answer

Consumer surplus

Answer

Producer surplus

Answer

Surplus

Question 13

An externality is a cost or benefit that:

Accepted Answer

Affects a third party not involved in the transaction

Answer

Is incurred by the government

Answer

Is paid by consumers

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Is received by producers

Question 14

A public good is characterized by:

Accepted Answer

Non-rivalry and non-excludability

Answer

Rivalry and non-excludability

Answer

Non-rivalry and excludability

Answer

Rivalry and excludability

Question 15

Partial equilibrium analysis involves the study of:

Accepted Answer

A single market, assuming all other markets are held constant

Answer

All markets simultaneously

Answer

Only the goods market

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Only the financial market

Question 16

The concept of marginal utility explains:

Accepted Answer

The additional benefit derived from consuming an extra unit of a good

Answer

The total benefit derived from consuming a good

Answer

The cost of producing a good

Answer

The price at which consumers are willing to buy a good

Question 17

In a perfectly competitive market, market equilibrium is determined by the point of intersection between:

Accepted Answer

Market demand and market supply curves

Answer

Demand curve and marginal cost curve

Answer

Supply curve and marginal revenue curve

Answer

Market demand curve and marginal utility curve

Question 18

Which of the following would cause the market demand curve to shift to the right?

Accepted Answer

An increase in consumer income

Answer

A decrease in the number of producers

Answer

A decrease in the price of a substitute good

Answer

An increase in the price of a complementary good

Question 19

In partial equilibrium analysis, prices in other related markets are:

Accepted Answer

Held constant, ceteris paribus

Answer

Completely ignored

Answer

Dynamically adjusted

Question 20

Which of the following is NOT a concept related to welfare economics?

Accepted Answer

Sunk cost

Answer

Deadweight loss

Answer

Consumer surplus

Answer

Producer surplus

Question 21

Externalities arise when:

Accepted Answer

The actions of one economic agent have unintended consequences on the well-being of others

Answer

Government intervention distorts market outcomes

Answer

Market prices fail to reflect the true social cost of production

Question 22

Which of the following is an example of a pure public good?

Accepted Answer

National defense

Answer

A medical treatment

Answer

A personal car

Answer

A restaurant meal

Question 23

In a market with economies of scale, the long-run equilibrium is likely to feature:

Accepted Answer

A few dominant firms controlling a large market share

Answer

A duopoly with two dominant firms

Answer

A single monopoly firm

Answer

A perfectly competitive market with many small firms

Question 24

A surplus in a market indicates that:

Accepted Answer

Quantity supplied exceeds quantity demanded

Answer

Price is above equilibrium

Answer

Quantity demanded equals quantity supplied

Answer

Quantity demanded exceeds quantity supplied