MANAGERIAL ECONOMICS AND BUSINESS STRATEGY STUDY GUIDE SUMMARY WITH SOLVED QUESTIONS FOR EXAM SUCCESS 2026

MANAGERIAL ECONOMICS AND BUSINESS
STRATEGY STUDY GUIDE SUMMARY WITH
SOLVED QUESTIONS FOR EXAM SUCCESS
2026

• A simultaneous decrease in demand and supply will unambiguously
A) raise the equilibrium price.
B) lower the equilibrium price.
C) lower the equilibrium quantity.
D) raise the equilibrium quantity. Answer: C) lower the equilibrium
quantity.


• An excise tax placed on the producer of an item will
A) shift the supply curve to the left.
B) shift the supply curve to the right.
C) make the supply curve steeper by rotating counterclockwise.
D) make the supply curve flatter by rotating clockwise. Answer: A)
shift the supply curve to the left.


• When government imposes a price floor below the market price, the
result will be that
A) surpluses occur.
B) shortages become a problem.

, C) supply and demand will shift up to the new equilibrium.
D) A price floor set below the equilibrium price will have no effect on
the market equilibrium. Answer: D) A price floor set below the
equilibrium price will have no effect on the market equilibrium.


• In a competitive market, the market demand is Qd = 48 - 5P and the
market supply is Qs = 7P. A price ceiling of $5 will result in a shortage
of
A) 36 units.
B) 24 units.
C) 16 units.
D) None of the responses are correct. Answer: D) None of the responses
are correct.


• The law of demand indicates that as the price of a good decreases, the
quantity
A) buyers desire increases.
B) buyers desire decreases.
C) producers offer to the market decreases.
D) producers offer to the market increases. Answer: A) buyers desire
increases.


• When an economist refers to a product as a "normal good," it implies
that
A) when incomes rise, demand for that product will fall.