Demand and Supply 2

What are examples of essential commodities?

• Food, clothing, shelter, medical expenses
• Telephone, special furniture, insurance
• Holidays, parties, visits to the theatres or concerts, chocolates
• All of the above

What does the Law of Demand state?

• The demand for a product varies directly with its price
• The demand for a product varies inversely with its price
• The demand for a product is determined by the quantity available
• The demand for a product is constant regardless of its price

How do changes in price affect demand for different types of goods?

• Price decreases lead to decreased demand
• Price increases lead to increased demand
• Price changes do not affect demand
• Price increases lead to decreased demand for non-essential goods and little change in demand for essential goods

How does price affect demand for essential and non-essential commodities?

• Price increases lead to decreased demand for non-essential commodities and little change in demand for essential commodities
• Price changes do not affect demand for either
• Price increases lead to decreased demand for both
• Price increases lead to increased demand for both

What is 'demand' in economic terms?

• The quantity of a product available for sale
• The willingness to pay for a product
• The ability to pay for a product
• The desire for a certain economic product

What is 'effective demand'?

• The quantity of a product available for sale
• The desire for a product coupled with the ability and willingness to pay
• The ability to pay for a product
• The desire for a product

What is the relationship between demand and price?

• Constant
• Unrelated
• Inverse
• Direct

What are examples of non-essential commodities?

• Telephone, special furniture, insurance
• Food, clothing, shelter, medical expenses
• Holidays, parties, visits to the theatres or concerts, chocolates
• All of the above

What is 'elasticity of supply'?

• The change in price in response to a change in demand
• The change in demand in response to a change in price
• The change in supply in response to a change in price
• The change in price in response to a change in supply

What is 'elasticity of demand'?

• The change in demand in response to a change in price
• The change in supply in response to a change in price
• The change in price in response to a change in demand
• The change in price in response to a change in supply