Market Demand and Supply Quiz

What does the law of demand state?

• There is a direct relationship between the price of a good and the quantity buyers are willing to purchase

• There is a direct relationship between the price of a good and the quantity sellers are willing to offer for sale

• There is an inverse relationship between the price of a good and the quantity sellers are willing to offer for sale

• There is an inverse relationship between the price of a good and the quantity buyers are willing to purchase

What is the law of supply?

• There is an inverse relationship between the price of a good and the quantity buyers are willing to purchase

• There is an inverse relationship between the price of a good and the quantity sellers are willing to offer for sale

• There is a direct relationship between the price of a good and the quantity sellers are willing to offer for sale

• There is a direct relationship between the price of a good and the quantity buyers are willing to purchase

What is the conclusion regarding changes in nonprice determinants and their impact on the demand curve?

• Changes in nonprice determinants can produce only a shift in a demand curve and not a movement along the demand curve

• Changes in nonprice determinants can produce a movement along the demand curve and not a shift in a demand curve

• Changes in nonprice determinants can produce both a shift and a movement along the demand curve

• Changes in nonprice determinants have no impact on the demand curve

What is the conclusion regarding changes in nonprice determinants and their impact on the supply curve?

• Changes in nonprice determinants can produce only a shift in a supply curve and not a movement along the supply curve

• Changes in nonprice determinants can produce a movement along the supply curve and not a shift in a supply curve

• Changes in nonprice determinants can produce both a shift and a movement along the supply curve

• Changes in nonprice determinants have no impact on the supply curve

What is a normal good?

• A good for which there is an inverse relationship between changes in income and its demand curve

• A good for which there is a direct relationship between changes in income and its demand curve

• A good that is jointly consumed with another good

• A good that competes with another good for consumer purchases

What is an inferior good?

• A good that is jointly consumed with another good

• A good that competes with another good for consumer purchases

• A good for which there is a direct relationship between changes in income and its demand curve

• A good for which there is an inverse relationship between changes in income and its demand curve

What are substitute goods?

• Goods for which there is an inverse relationship between changes in income and its demand curve

• Goods for which there is a direct relationship between changes in income and its demand curve

• Goods that compete with another good for consumer purchases

• Goods that are jointly consumed with another good

What are complementary goods?

• Goods that are jointly consumed with another good

• Goods for which there is an inverse relationship between changes in income and its demand curve

• Goods that compete with another good for consumer purchases

• Goods for which there is a direct relationship between changes in income and its demand curve

What happens when the price increases for a good that has a substitute?

• The supply curve for the substitute good decreases

• The supply curve for the substitute good increases

• The demand curve for the substitute good increases

• The demand curve for the substitute good decreases

What happens when the price increases for a good that has a complement?

• The supply curve for the complementary good increases

• The demand curve for the complementary good increases

• The demand curve for the complementary good decreases

• The supply curve for the complementary good decreases