The law of demand states that, other things being equal, as price of a good rises: MCQ with Answer and Explanation

The law of demand states that, other things being equal, as price of a good rises:
A. demand rises
B. quantity demanded rises
C. demand falls
D. quantity demanded falls
Answer: Option D
Solution (By JKSSB Mock Tests)
The law of demand states an inverse relationship between price and quantity demanded.

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Practice More Economy Set 1 Questions

Question #1
Frictional unemployment is best described as:
A. temporary unemployment during job search or transition
B. unemployment due to lack of demand
C. long-term unemployment due to skill mismatch
D. unemployment due to seasonal agriculture

Correct Answer: Option A


Explanation:
Frictional unemployment is temporary unemployment during job search or transition.

This question belongs to: Economy GK Economy Set 1
Question #2
The concept of 'Economic Value Added' (EVA) is defined as:
A. Only revenue minus explicit costs
B. Net operating profit after tax minus the opportunity cost of capital employed
C. Only cash flow
D. Only accounting profit

Correct Answer: Option B


Explanation:
Economic Value Added is a measure of residual income calculated as net operating profit after tax minus a charge for the opportunity cost of the capital employed in the business.

This question belongs to: Economy GK Economy Set 1
Question #3
Which of the following is a characteristic of the Indian tax structure post-GST?
A. Origin-based taxation without input credit
B. Multiple cascading taxes on the same value addition
C. Destination-based consumption tax with input tax credit
D. Only central taxes without state participation

Correct Answer: Option C


Explanation:
GST is a destination-based consumption tax that allows seamless input tax credit, thereby eliminating cascading and creating a unified market.

This question belongs to: Economy GK Economy Set 1