Page 1 of 152
ABEKA ECONOMICS Test 2 WITH 100%
VERIFIED QUESTIONS & ANSWERS
1. The law of demand states that as price increases,
quantity demanded _____.
• A) Increases
• B) Decreases
• C) Stays the same
• D) Doubles
✅ B) Decreases
Rationale: Inverse relationship: price up → demand down
(ceteris paribus).
2. A shift of the demand curve to the right indicates _____.
• A) Decrease in demand
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• B) Increase in demand
• C) Increase in quantity demanded
• D) Decrease in supply
✅ B) Increase in demand
Rationale: Right shift = more demanded at each price.
3. Scenario: The price of coffee falls. What happens to the
demand for tea (a substitute)?
• A) Increases
• B) Decreases
• C) No change
• D) Doubles
✅ B) Decreases
Rationale: Substitute goods: cheaper coffee → less tea
demanded.
4. The law of supply says price and quantity supplied are
_____ related.
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• A) Inversely
• B) Directly
• C) Not
• D) Negatively
✅ B) Directly
Rationale: Higher price → higher quantity supplied.
5. Equilibrium price is where _____.
• A) Supply exceeds demand
• B) Demand exceeds supply
• C) Quantity demanded = quantity supplied
• D) Price is highest
✅ C) Quantity demanded = quantity supplied
Rationale: Market-clearing price.
6. A surplus occurs when price is _____ equilibrium.
• A) Below
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• B) Above
• C) At
• D) Unrelated to
✅ B) Above
Rationale: Price too high → quantity supplied > quantity
demanded.
7. Scenario: A new study says eating avocados prevents
disease. The demand curve for avocados will _____.
• A) Shift left
• B) Shift right
• C) Become vertical
• D) Become horizontal
✅ B) Shift right
Rationale: Increased preference → higher demand.
8. Which would NOT shift the demand curve for cars?
ABEKA ECONOMICS Test 2 WITH 100%
VERIFIED QUESTIONS & ANSWERS
1. The law of demand states that as price increases,
quantity demanded _____.
• A) Increases
• B) Decreases
• C) Stays the same
• D) Doubles
✅ B) Decreases
Rationale: Inverse relationship: price up → demand down
(ceteris paribus).
2. A shift of the demand curve to the right indicates _____.
• A) Decrease in demand
,Page 2 of 152
• B) Increase in demand
• C) Increase in quantity demanded
• D) Decrease in supply
✅ B) Increase in demand
Rationale: Right shift = more demanded at each price.
3. Scenario: The price of coffee falls. What happens to the
demand for tea (a substitute)?
• A) Increases
• B) Decreases
• C) No change
• D) Doubles
✅ B) Decreases
Rationale: Substitute goods: cheaper coffee → less tea
demanded.
4. The law of supply says price and quantity supplied are
_____ related.
,Page 3 of 152
• A) Inversely
• B) Directly
• C) Not
• D) Negatively
✅ B) Directly
Rationale: Higher price → higher quantity supplied.
5. Equilibrium price is where _____.
• A) Supply exceeds demand
• B) Demand exceeds supply
• C) Quantity demanded = quantity supplied
• D) Price is highest
✅ C) Quantity demanded = quantity supplied
Rationale: Market-clearing price.
6. A surplus occurs when price is _____ equilibrium.
• A) Below
, Page 4 of 152
• B) Above
• C) At
• D) Unrelated to
✅ B) Above
Rationale: Price too high → quantity supplied > quantity
demanded.
7. Scenario: A new study says eating avocados prevents
disease. The demand curve for avocados will _____.
• A) Shift left
• B) Shift right
• C) Become vertical
• D) Become horizontal
✅ B) Shift right
Rationale: Increased preference → higher demand.
8. Which would NOT shift the demand curve for cars?
