Economics Unit 3 Supply & Demand Vocabulary Quiz

The quantity purchased varies inversely with price. In other words, people will buy more of a good/service at lower prices and less at higher prices.

• law of supply

• law of demand

• demand

• supply

The willingness and ability to bring to the market (produce/sell) specific quantities of a good/service at different prices.

• supply

• demand

• surplus

The one price at which quantity supplies equals quantity demanded.

• elasticity

• price ceiling

• equilibrium price

Generally, the price is set below equilibrium price and results in this. More demand than supply.

• demand

• shortages

• surplus

The willingness and ability to buy specific quantities of a good/service at different prices.

• demand

• supply

• price floor

The degree to which buyers and sellers respond to price changes.

• supply

• elasticity

• price ceiling

This prevents market forces of supply and demand to set prices.

• price ceiling

• price floor

• supply

The amount of goods or services that producers make available for sale at a given price.

• supply

• demand

• Law of Supply

Typically, government or group imposed to control how low a price can be.

• price ceiling

• price floor

• surplus

A good whose use is related to the use of an associated or paired good.

• price floor

• shortages

• demand

• complementary good