Supply and Demand Quiz

What is supply in economic terms?

• The amount of goods sellers have

• The relationship between the price of a good and how much sellers want to sell

• The amount of goods consumers want

• The relationship between the price of a good and how much consumers want to buy

What is demand in economic terms?

• The relationship between the price of a good and how much consumers want to buy

• The relationship between the price of a good and how much sellers want to sell

• The amount of goods consumers want

• The amount of goods sellers have

What happens to demand if the price of a good increases?

• Demand becomes zero

• Demand remains constant

• Demand decreases

• Demand increases

What happens to supply if the price of a good increases?

• Supply remains constant

• Supply increases

• Supply decreases

• Supply becomes zero

Who first described the phenomenon of supply and demand?

• John Locke

• James Steuart

• Adam Smith

• John Stuart Mill

What is the equilibrium price?

• The price at which the quantity demanded by consumers is greater than the quantity supplied by producers

• The price at which the quantity demanded by consumers is less than the quantity supplied by producers

• The price at which the quantity demanded by consumers is equal to the quantity supplied by producers

• The price at which the quantity demanded by consumers is zero

What happens when the system of supply, demand, and price is interfered with?

• We get shortages

• Demand increases

• Supply increases

• Nothing changes

What was the result of the US federal government’s price controls on natural gas in the 1960s and '70s?

• Supply of natural gas increased

• Demand for natural gas decreased

• Natural gas became more profitable

• Natural gas shortages occurred

What is the principle of supply and demand?

• A constant relationship between price and quantity

• A fixed amount of goods in the market

• An evolving relationship between price and quantity

• A fixed amount of demand from consumers

What is the likely equilibrium price of a loaf of sourdough bread in a city or country?

• $2 per loaf

• $100 per loaf

• $1 per loaf

• $3 per loaf