COBA EXAM 2026/2027 QUESTIONS
AND ANSWERS 100% CORRECT
If the average household income increases and there is relatively little change in the
price of a normal good then
A) Supply curve will shift to the left
B) Quantity demanded will move farther down the demand curve
C) Demand will shift to the left
D) Demand will shift to the right - ANSWER-D) Demand will shift to the right
The demand curve for a normal good is
A) Upward sloping because firms produce more at higher prices
B) Upward sloping because higher-priced goods are of higher quality
C) Vertical
D) Downward sloping because of the income and substitution effects of price
changes - ANSWER-D) Downward sloping because of the income and substitution
effects of price changes
A decrease in the price of a complementary good will
A) Shift the demand curve of the other commodity to the left
B) Increase the price paid for a substitute good
C) Shift the supply curve of the other commodity to the left
D) Shift the demand curve of the other commodity to the right - ANSWER-D) Shift
the demand curve of the other commodity to the right
Which one of the following changes will cause the demand curve for gasoline to shift
to the left
A) The price of gasoline increases
B) The supply of gasoline decreases
C) The price of cars increase
D) The price of cars decrease - ANSWER-C) The price of cars increase
Tennis rackets and tennis balls are
A)Substitute goods
B) Independent goods
C) Inferior goods
D) Complementary goods - ANSWER-D) Complementary goods
A supply curve illustrates the relationship between
A) Price and quantity supplied
B)Price and consumer tastes
C) price and quantity demanded
D) Supply and demand - ANSWER-A) Price and quantity supplied
In relation to the laws of supply and demand, an increase in supply will
A) Increase the equilibrium price and the equilibrium quantity exchanged
B) Decrease the equilibrium price and the equilibrium quantity exchanged
, C) Increase the equilibrium price and decrease the equilibrium quantity exchanged
D) Decrease the equilibrium price and increase the equilibrium quantity exchanged -
ANSWER-D) Decrease the equilibrium price and increase the equilibrium quantity
exchanged
An increase in the market supply of beef would result in a(n)
A) increase in the price of beef
B) Decrease in the price of beef
C) Increase in the price of pork
D) Increase in the quantity of the beef demanded - ANSWER-D) Increase in the
quantity of the beef demanded
In any competitive market, an increase in both demand and supply can be expected
to always
A) Increase both price and market-clearing quantity
B) Decrease both price and market-clearing quantity
C) Increase market-clearing quantity
D) Increase price - ANSWER-C) Increase market-clearing quantity
If both the supply and demand for a good increase, the market price will
A) Rise only in the case of an inelastic supply function
B) Fall only in the case of an inelastic supply function
C) Not be predictable with only these facts
D) Rise only in the case of an inelastic demand function - ANSWER-C) Not be
predictable with only these facts
Which of the following statements about supply and demand is true
A) If supply increases and demand remains constant, equilibrium price will rise
B) If demand increases and supply decreases, equilibrium price will fall
C) If demand increases and supply increases, equilibrium quantity will fall
D) If demand increases and supply decreases, equilibrium price will increase -
ANSWER-D) IF demand increases and supply decreases, equilibrium price will
increase
X and Y are substitute products. If the price of product Y increases, the immediate
impact on the product X is that its
A) Price will increase
B) Quantity demanded will increase
C) Quantity supplied will increase
D) Price, quantity demanded and supplies will increase - ANSWER-B) Quantity
demanded will increase
The demand curve for a product reflects which of the following
A) The impact of prices on the amount of the product offered
B) The willingness of producers to offer a product at alternative prices
C) The impact that price has on the amount of a product purchased
D) The impact that price has on the purchase amount of 2 related products -
ANSWER-C) The impact that price has on the amount of a product purchased
AND ANSWERS 100% CORRECT
If the average household income increases and there is relatively little change in the
price of a normal good then
A) Supply curve will shift to the left
B) Quantity demanded will move farther down the demand curve
C) Demand will shift to the left
D) Demand will shift to the right - ANSWER-D) Demand will shift to the right
The demand curve for a normal good is
A) Upward sloping because firms produce more at higher prices
B) Upward sloping because higher-priced goods are of higher quality
C) Vertical
D) Downward sloping because of the income and substitution effects of price
changes - ANSWER-D) Downward sloping because of the income and substitution
effects of price changes
A decrease in the price of a complementary good will
A) Shift the demand curve of the other commodity to the left
B) Increase the price paid for a substitute good
C) Shift the supply curve of the other commodity to the left
D) Shift the demand curve of the other commodity to the right - ANSWER-D) Shift
the demand curve of the other commodity to the right
Which one of the following changes will cause the demand curve for gasoline to shift
to the left
A) The price of gasoline increases
B) The supply of gasoline decreases
C) The price of cars increase
D) The price of cars decrease - ANSWER-C) The price of cars increase
Tennis rackets and tennis balls are
A)Substitute goods
B) Independent goods
C) Inferior goods
D) Complementary goods - ANSWER-D) Complementary goods
A supply curve illustrates the relationship between
A) Price and quantity supplied
B)Price and consumer tastes
C) price and quantity demanded
D) Supply and demand - ANSWER-A) Price and quantity supplied
In relation to the laws of supply and demand, an increase in supply will
A) Increase the equilibrium price and the equilibrium quantity exchanged
B) Decrease the equilibrium price and the equilibrium quantity exchanged
, C) Increase the equilibrium price and decrease the equilibrium quantity exchanged
D) Decrease the equilibrium price and increase the equilibrium quantity exchanged -
ANSWER-D) Decrease the equilibrium price and increase the equilibrium quantity
exchanged
An increase in the market supply of beef would result in a(n)
A) increase in the price of beef
B) Decrease in the price of beef
C) Increase in the price of pork
D) Increase in the quantity of the beef demanded - ANSWER-D) Increase in the
quantity of the beef demanded
In any competitive market, an increase in both demand and supply can be expected
to always
A) Increase both price and market-clearing quantity
B) Decrease both price and market-clearing quantity
C) Increase market-clearing quantity
D) Increase price - ANSWER-C) Increase market-clearing quantity
If both the supply and demand for a good increase, the market price will
A) Rise only in the case of an inelastic supply function
B) Fall only in the case of an inelastic supply function
C) Not be predictable with only these facts
D) Rise only in the case of an inelastic demand function - ANSWER-C) Not be
predictable with only these facts
Which of the following statements about supply and demand is true
A) If supply increases and demand remains constant, equilibrium price will rise
B) If demand increases and supply decreases, equilibrium price will fall
C) If demand increases and supply increases, equilibrium quantity will fall
D) If demand increases and supply decreases, equilibrium price will increase -
ANSWER-D) IF demand increases and supply decreases, equilibrium price will
increase
X and Y are substitute products. If the price of product Y increases, the immediate
impact on the product X is that its
A) Price will increase
B) Quantity demanded will increase
C) Quantity supplied will increase
D) Price, quantity demanded and supplies will increase - ANSWER-B) Quantity
demanded will increase
The demand curve for a product reflects which of the following
A) The impact of prices on the amount of the product offered
B) The willingness of producers to offer a product at alternative prices
C) The impact that price has on the amount of a product purchased
D) The impact that price has on the purchase amount of 2 related products -
ANSWER-C) The impact that price has on the amount of a product purchased
