Quiz Economics Introduction to Demand and Supply

Q1). In the short term, the prices are ____________?

Q2). In a normal scenario, a drop in the fuel price will _______  the price level of a bus ticket ? 

Q3). A macro model is calculating or explaining GDP as an output. Will the GDP variable be an Exogenous or Endogenous Variable? 

Q4). Is it correct to say that the COVID-19 pandemic caused a demand shock in the airline industry? 

Q5).  The following is an example of a commodity? 

Q6). Country A imports Cashew Nuts; Cashew Nuts forms a significant part of imported dry fruits. Cashew Nuts are an essential ingredient of a special delicacy made on multiple occasions in Country A. Now answer the following question based on the information shared.

If the price of Cashew Nuts increases in the international market, what happens to the demand for Cashew Nuts in Country A, keeping other factors constant.

Q7). Country A imports Cashew Nuts; Cashew Nuts forms a significant part of imported dry fruits. Cashew Nuts are an essential ingredient of a special delicacy made on multiple occasions in Country A. Now answer the following question based on the information shared.

Now consider that the price of Cashew Nuts shoots up and increases by 100%. Currently, there are substitutes available for Cashew Nuts available in the market. Choose what Country A is expected to do. Country A is a lower-middle-income country with a significant portion of the population sensitive to increases in price. Consider people have an above-average propensity to try substitutes.

Q8). Taking the case of an increase in the price of Cashew Nuts, what will happen to the market equilibrium?