Supply & Demand Quiz

The Law of Demand is one of the most famous laws in economics. It states that when the price of a good rises, the quantity demanded ______________, and when the price of a good falls, the quantity demanded _____________.

• rises, rises

• falls, falls

• rises, falls

• falls, rises

What will probably happen when the price of a product goes down?

• other prices will increase

• more people will want that product

• fewer people will want that product

• fewer people will want that product

Supply is the total amount of a good or service that is available to ______.

• consumers

• distribute

• purchase

• redistribute

In a market economy, a high price will usually cause

• producers to offer less and consumers to buy less.

• producers to offer less and consumers to buy more.

• producers to supply more and consumers to buy less.

• producers to supply more and consumers to buy more.

The graph shows a demand curve. What can be said about the demand line moving to the right?

• Demand has decreased.

• Demand has increased.

• This indicates a reduced supply.

• An equilibrium price has been determined.

What economic concept does this graph BEST illustrate?

• Scarcity

• Productivity

• Law of Demand

• Law of Supply

What is an economic principle that describes a consumer's desire and willingness to pay a price for a specific good or service?

• Demand

• Supply

• Law of Demand

• Law of Supply

Assuming that the graph follows the normal laws of economics, the line represents

• demand.

• supply.

• equilibrium price.

• production possibilities.

The statement "the quantity demanded of a product varies inversely with its price" is a definition of

• The Law of Demand

• The Law of Supply

• Demand

• Supply

Which BEST explains the relationship shown on the graph?

• A product becomes scarcer as it price decreases.

• The price of a product has no effect on consumer demand.

• Fewer people will buy a product when its price increases.

• A product costs more when many people want to purchase it.