Supply and Demand Review

Which of the following best describes the Law of Demand?

• As price goes down, demand goes down. (and vice versa).

• Demand does not affect the price.

• As demand goes down, supply goes up.

• As demand goes up, price becomes elastic.

If a consumer knows that a product will be going on sale this, how will his/her CURRENT demand be affected?

• It will go up.

• It will stay the same

• It will go down

• None of these are correct

In a market economy, who decides on the prices of goods and services?

• Government

• Firms

• Buyers and Sellers

• Local Leaders

The price of movie tickets in Hickory has risen from $7.00 to $9.00.  What is the most likely effect of the change in price?

• The demand curve for movie tickets will move right

• The demand curve for movie tickets will move left

• The quantity demanded for movie tickets will increase

• The quantity demand for movie tickets will decrease

A new study has shown that avocados are extremely healthy.  The demand for avocados has increased due to a change in:

• market size.

• price of a complementary good.

• price of a substitute good.

• tastes and preferences.

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

• Prices or availability of substitutes

• Change in the weather or season

• Prices or availability of complementary goods

• Population (Change in the number of buyers)

The want or willingness a consumer has to purchase a good or a service is called:

• demand.

• shortage.

• price.

• supply.

A decrease in the price of something will:

• increase supply.

• increase quantity supplied.

• decrease supply.

• decrease quantity supplied.

What is the quantity of a good or service that producers sell at a market price?

• Supply

• Law of Demand

• Demand

• Law of Supply

The amount of goods or services available for a producer to sell is called:

• supply.

• producer.

• demand.

• consumer.