EC-011

Marcy is ready to buy a new computer, and she has saved up enough money to buy the model she wants. Which of the following describes the quantity that Marcy is prepared to buy:

• Demand

• Elasticity

• Supply

• Market Price

Jeremy has $15,000 to spend on a new car. He found a car that cost $14,500, but he did not think the car was worth more than $12,000. The dealer told Jeremy that he has not been able to sell this model because other customers have expressed the same opinion as Jeremy. Does demand for this car exist?

• Yes, because consumers like the car but don’t buy it.

• Yes, because consumers think the car is worth $12,000.

• No, because consumers do not have the buying power to purchase this car.

• No, because consumers are not willing to pay the price being asked for this car.

The quantity of a good or service that producers are able and willing to offer for sale at a specified price in a given period of time is

• quantity demanded.

• quantity sold.

• demand.

• supply.

When the price of DVD players increases, the quantity of DVD players offered for sale will increase. This is an example of the law of

• supply.

• cost of production.

• demand.

• standardization.

Your business is selling more and more large-screen televisions each month. Applying the law of supply and demand, what do you expect to happen to the price and supply of these televisions over the next few months?

• The price will decrease, and supply will increase.

• The price will decrease, and supply will decrease.

• The price will increase, and supply will decrease.

• The price will increase, and supply will increase.

A local neighborhood has many houses for sale at a low price, but demand for the houses is low. What kind of market most likely exists in the neighborhood?

• Seller’s

• Buyer’s

• Inelastic

• Discretionary

Which of the following is characteristic of a seller’s market:

• Small demand

• High prices

• Low profits

• Large supply

Marc wants to figure out how much changes in price will affect his business’s sales, so he pays attention to

• market price.

• inelastic demand.

• elasticity.

• elastic demand.

Orlando changes the price of one of his products, and this price change leads to a major change in the number of people who purchase the product. This means that demand for Orlando’s product is

• constant.

• inelastic.

• competitive.

• elastic.

Demand for a good is more likely to be elastic when the good is

• essential.

• a luxury.

• a necessity.

• inexpensive.