Supply and Demand Scenarios

Corn crops are very plentiful over the course of the year and there is more corn than people would normally buy. To get rid of the excess supply, farmers need to ________________ .

• increase the price of corn

• plant a different crop

• lower the price of corn

• plant more corn

There is a drought and very few strawberries are available. More people want strawberries than there are berries available. The price of strawberries __________________.

• decreases dramatically

• stays the same

• increases dramatically

• goes down

A huge wave of new, unskilled workers come to a city and all of the workers are willing to take jobs at low wages. Because there are more workers than there are available jobs, the excess supply of workers makes wages _______________ .

• go down

• go up

• stay the same

• increase dramatically

Corn crops are very plentiful over the course of the year and there is more corn than people would normally buy.

In economics, what is this called?

• a shortage

• oversupply

• underdemand

• a surplus

There is a drought and very few strawberries are available. More people want strawberries than there are berries available.

There is a _____________________ of strawberries.

• undersupply

• oversupply

• surplus

• shortage

A popular artist dies and, thus, he obviously will be producing no more art. Demand for his art ________________ as people want to purchase the few pieces that exist.

• increases

• is in surplus

• decreases

• goes down

A cultural fad item that was all-the-rage for a period of time falls out of favour and is no longer "cool." Demand for the item _____________________ as it is no longer the must-have item of the season.

• increases

• decreases

• shows a shortage

• is in surplus

A new restaurant opens up in town and gets great reviews. There are only 12 tables in the restaurant but everyone wants to get a reservation. Demand for the reservations ______________________.

• goes up

• goes down

• doesn't change

• affects supply

A company sets the price of its product at $10.00. No one wants the product, so the price is lowered to $9.00. Demand for the product _______________________ at the new lower price point and the company begins to make money and a profit.

• stays the same

• decreases

• goes down

• increases

At some point, too much of a demand for the product will cause the supply to decrease. As a result, prices will ___________. The product will then become too expensive, demand will go down at that price and the price will fall.

• stabilise

• go down

• increase

• stay the same