Supply & Demand Review

Which statement expresses a central idea of how the laws of supply and demand work?

• The government sets the prices for goods and services.
• Prices are determined by the interaction of producers and consumers.
• Consumers alone determine the prices for goods and services.
• Technology dictates the prices charged for goods and services.

Mr Tonkli goes to the ticket booth to buy tickets for a Cavs game. Mr. Tonkli is told that the game is sold out and no tickets are available. Which best explains why there are no basketball tickets available? 

• The arena forgot to print enough tickets.
• The supply of tickets was greater than the demand.
• The arena charged too much money for each ticket.
• The demand for tickets was greater than the supply.

A graphic organizer is shown. What is the best title for it?

• Factors Causing the Price of a Product to Rise.
• Why Demand for Goods Falls.
• How the Price of Raw Materials Influences Demand.
• Why Workers' Wages Are Sometimes Reduced.

Which situation is most likely to lead to the lowest prices?

• There is only one producer making the good.
• Businesses secretly agree to share their profits.
• Competition between businesses is prohibited.
• Several producers compete to sell goods to the public.

When companies compete in a market economy, what is usually the result?

• Consumers are able to buy goods for the best available price.
• People pay much higher prices for goods.
• There are frequent shortages of goods on the market.
• Producers refuse to sell some of their products.

Local stores sell a particular pair of sneakers for $80. A picture of a basketball star Lebron James wearing these sneakers appears in all the local Ohio newspapers. The next day, sales for sneakers start to rise.
What is likely to happen to the price of the sneakers over the next several weeks?

• People will refuse to buy these sneakers.
• The price for the sneakers will not change.
• The price will fall as people learn Lebron James wears them.
• The price of the sneakers will rise as more people want similar sneakers.

How does competition affect producers in a market economy? 

• They generally agree to share resources equally.
• They improve the quality of their goods to attract buyers.
• They look to the government to assign resources.
• They ration their goods equally among consumers.

Read the following situation to determine what the outcome would be:

A new type of television set uses 3-D images. many stores will have large quantities of the older style televisions. What will happen to the price of these older televisions? 

• The price will remain the same.
• The price will rise.
• The price will fall.

Read the following situation to answer the question:

The yeast needed to to make whole wheat bread rises sharply in price. What will happen to the price of whole wheat bread?

• The price will rise.
• The price will stay the same.
• The price will fall.

A new video game has just been released before the winter holiday season, when may families buy gifts. This is a video game that many children want. Many parents buy this video game system for their children. The price throughout December is $249.

What is most likely to happen to the price for this video game in January, when the most popular gift buying season is over?

• The price will go up for the new year then fall.
• Sellers will lower their prices when the demand for the video game slows.  
• The price for the video game will remain at $249.
• The price will rise since since the games manufacturer will refuse to produce anymore.