Year 11 Economics Topic 3 Markets – Demand

Question 1 Multiple Choice

1. Which of the following is most likely to cause a demand curve to shift to the
left?
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a. A fall in the cost of inputs to production
b. A rise in general income levels
c. A rise in the price of the good
d. A rise in the price of a complementary good
2. Which good is most likely to have relatively price elastic demand?
________
a. Fruit and vegetables
b. Cigarettes
c. A sports car
d. Medication
3. If predictions concerning global warming are accurate, what is likely to be the
future change in the demand curve for air-conditioners?
_________
a. Shift to the left
b. Shift to the right
c. There will be a movement upwards along the curve
d. There will be a movement downwards along the curve
4. Which of the following is the most likely explanation for a movement along the
demand curve for bus tickets?
_________
a. An advertising campaign convinces consumers that trains cause less
pollution than buses, so consumers substitute the bus for the train
b. The amount of roadwork in the town increases, increasing bus travel
times
c. The price of bus tickets rises, so consumers substitute the train for the
bus
d. The price of monorail tickets rises, so more consumers begin catching
buses
5. In order to maximise tax revenue, the government would most likely place an
indirect tax on which of the following?
_________
a. Designer clothes
b. Take-away food
c. Chocolate
d. Petrol
Year 11 Economics Topic 3 Markets – Demand

Question 2 True or False

1. A more equal distribution of income in Australia would shift the demand curve
for luxury yachts to the left.
_________
2. Demand curves are always downward sloping.
_________
3. A contraction in the quantity of margarine demanded would occur if the price
of butter fell.
_________
4. An increase in demand for beach dresses would occur if their price fell.
_________
5. If the level of income in Australia increased, the demand curve for most goods
would shift to the right.
_________

Question 3 Short Answer

1. Using demand curves, illustrates the effect that the following changes would
have on the demand for Qantas airline tickets to Hayman Island:
a. Qantas conducts a successful marketing campaign

b. A nex tax is placed on all airline flights, increasing the price of tickets
Year 11 Economics Topic 3 Markets – Demand

c. A statistical report is released indicating that Virgin Blue is a safer

airline

d. For the month of July, a 10% discount is offered on all Qantas flights to
Hayman Island

2. Briefly outline FOUR factors that could cause an increase in demand for
Coca-Cola.

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Year 11 Economics Topic 3 Markets – Demand

Question 4 Answer: The factors affecting individual consumer demand

1. Although a rise in a person’s income will generally increase their demand for
goods, there are some good for which demand will fall when income rises.
Identify the name given to these types of goods and explain why this
phenomenon occurs.
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2. There are some goods that actually experience a fall in demand when price
decreases. Identify these types of goods and explain why this phenomenon
occurs.
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