Unit 2 "Supply and Demand"

Front

Which statement describes the law of demand?

Back

As prices rise, quantity demanded decreases (and vice versa)

Front

Which of the following explains why a supply curve is upward sloping? Options: the Law of Demand states there is an indirect relationship between price and quantity, the Law of Supply states there is a direct relationship between price and quantity, the Law of Supply compares marginal costs and marginal benefits in a constant rate, the Law of Demand shows a positive relationship between two goods, creating the slope

Back

the Law of Supply states there is a direct relationship between price and quantity

Front

Which is an example of the Law of Demand at work?

Back

Demand for pizza rises when the price of pizza falls

Front

What causes a shift in the demand curve?

Back

A change in something other than price.

Front

The amount of a good or service that producers are willing and able to sell at all possible prices during a given period of time.

Back

Supply

Front

The market equilibrium price is the price at which...

Back

the quantity demanded is the same as the quantity supplied

Front

What is the Equilibrium Price according to this market?

Back

3

Front

Which example below best illustrates the flexibility markets have in dealing with excess demand? If a particular good experiences a shortage, an increase in the price will reduce quantity demanded.

Back

If a particular good experiences a shortage, an increase in the price will reduce quantity demanded.

Front

The diagram represents a(n)...

Back

increase in supply

Front

The diagram represents a(n)...

Back

increase in demand