Demand & Supply

Thousands of people leave a small town due to a factory closing down. Sales at the local grocery store are reduced. What causes this change?

• Prices or availability of substitutes

• Prices or availability of complementary goods

• Change in the weather or season

• Change in the number of buyers

New technology advances the rate at which furniture can be assembled. Why does this change the supply?

• There is a change in cost of production.

• The number of producers changes.

• The expectations of consumers changes.

• The output rate declines.

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.

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.

Which of the following would NOT be a determinant of demand?

• The price of related goods

• Income

• Tastes

• The prices of the inputs used to produce the good

If the price of a substitute to good X increases, then

• The demand for good X will increase.

• The market price of good X will decrease.

• The demand for good X will decrease.

• The demand for good X will not change.

Suppose you like banana cream pie made with vanilla pudding. Assuming all other things are constant, you notice that the price of bananas is higher. How would your demand for vanilla pudding be affected by this?

• It would decrease.

• It would increase.

• It would be unaffected.

• There is insufficient information given to answer the question.

A higher price for batteries would tend to

• increase the demand for flashlights.

• decrease the demand for electricity.

• increase the demand for electricity.

• increase the demand for batteries.

What will happen in the rice market if buyers are expecting higher prices in the near future?

• The demand for rice will increase.

• The demand for rice will decrease.

• The demand for rice will be unaffected.

• The supply of rice will increase.

Refer to Graph 4-1. The movement from point A to point B on the graph shows

• a decrease in demand.

• an increase in demand.

• an increase in quantity demanded.

• a decrease in quantity demanded.

Tags

CCSS.8.EE.B.5