E.12: Market Equilibrium Quiz

What does market equilibrium refer to in economics?

• A. The state of balance between supply and demand

• D. The state of constant decrease in supply and demand

• B. The state of imbalance between supply and demand

• C. The state of constant increase in supply and demand

According to the law of demand, what happens to the quantity demanded as the price of a good or service decreases?

• A. It decreases

• C. It remains constant

• B. It increases

• D. It fluctuates

What is the law of supply in economics?

• C. As the price increases, the quantity supplied increases

• D. As the price decreases, the quantity supplied decreases

• B. As the price decreases, the quantity supplied increases

• A. As the price increases, the quantity supplied decreases

How do supply and demand guide prices towards equilibrium if you are in a surplus?

• B. By decreasing the price until equilibrium is reached

• C. By keeping the price constant until equilibrium is reached

• A. By increasing the price until equilibrium is reached

• D. By fluctuating the price until equilibrium is reached

What happens to the quantity demanded as the price of a good or service increases according to the law of demand?

• C. It remains constant

• A. It decreases

• D. It fluctuates

• B. It increases

In the market for a popular consumer product, what happens when the quantity demanded exceeds the quantity supplied?

• A. Prices decrease until equilibrium is reached

• B. Prices increase until equilibrium is reached

• C. Prices remain constant until equilibrium is reached

• D. Prices fluctuate until equilibrium is reached

What is the state of balance between supply and demand in a market called?

• B. Market stability

• D. Market fluctuation

• A. Market imbalance

• C. Market equilibrium

How do the forces of supply and demand guide prices towards equilibrium when you are in a shortage?

• B. By decreasing the price until equilibrium is reached

• A. By increasing the price until equilibrium is reached

• C. By keeping the price constant until equilibrium is reached

• D. By fluctuating the price until equilibrium is reached

What happens to the quantity supplied as the price of a good or service decreases according to the law of supply?

• A. It decreases

• B. It increases

• C. It remains constant

• D. It fluctuates