CA Foundation Supply — practice questions
38 free MCQs with worked solutions. Tap any question for the answer + explanation, or practice them all in the app.
Practice CA Foundation Supply in the app →In economics, the term 'supply' is best described as the amount of a good that producers are:Supply is correctly classified as which type of economic variable?The law of supply states that, other things remaining constant, as the price of a good rises, the quantity supThe supply curve of a typical good slopes upward to the right. This positive slope reflects the fact that:Which of the following is a recognised determinant of the supply of a good, other than the good's own price?An improvement in production technology that lowers the unit cost of making a good will, other things constantA rise in the wages paid to workers in a steel plant, other things remaining the same, would most likely causeA change in the quantity supplied of a good caused only by a change in that good's own price is shown on a diaWhen a fall in market price leads producers to offer less for sale, moving down along the same supply curve, tWhen a supply curve shifts bodily to the left, it conveys that, at each given price, producers now offer:A farmer can grow either wheat or corn on the same land. If the market price of corn rises sharply while the pIf sellers strongly expect the price of a storable good to rise sharply in the near future, their supply of thThe government grants a per-unit subsidy to producers of a good. Other things constant, the most likely effectElasticity of supply measures the responsiveness of the quantity supplied of a good to a change in its:The coefficient of price elasticity of supply is computed as the percentage change in quantity supplied divideA vertical supply curve drawn parallel to the price axis indicates that the elasticity of supply is:A horizontal supply curve drawn parallel to the quantity axis indicates that the elasticity of supply is:If the percentage change in quantity supplied of a good is smaller than the percentage change in its price, thWhen the quantity supplied of a good changes substantially in response to a small change in its price, the supThe price of a commodity rises from Rs 200 to Rs 220 and, as a result, the quantity supplied rises from 1,000 The price of a good rises by 8% and the quantity supplied of it rises by 12%. The elasticity of supply equals:The supply function for a good is $q = -50 + 5p$. Using the point method, the elasticity of supply when price The supply function for a good is $q = -20 + 4p$. Using the point method, the elasticity of supply when price Using the arc method, find the elasticity of supply when price rises from Rs 10 to Rs 15 and quantity suppliedUsing the arc method, find the elasticity of supply when price rises from Rs 12 to Rs 18 and quantity suppliedAn industry has idle plant capacity. According to the source, the availability of spare production capacity maAccording to the source, how does a longer time period generally affect the price elasticity of supply of a goGoods requiring complex production processes and a long time to produce, such as cruise ships and aircraft, teFor a highly perishable commodity that cannot be stored, the supply curve during a very short period is generaA short-run supply schedule for fighter aircraft shows 28 units offered at every price from $124 million to $1The market price of a good is the level at which the wishes of buyers and sellers coincide, so that quantity dIn a market, the demand and supply schedule shows that at Rs 3 quantity demanded equals quantity supplied at 1If, at the prevailing price, the quantity demanded of a good exceeds the quantity supplied, the resulting presIf the supply of bottled water decreases while demand stays the same, the new market equilibrium will show:Producer surplus in a market is best described as the benefit producers gain because the price they receive isSocial efficiency in a competitive market is achieved at the equilibrium price because at that point:An increase in the number of firms selling a good in a market, other things constant, will cause the industry A noted exception to the law of supply is the supply of labour, where at very high wage rates the quantity of