SUPPLY DEMAND BASICS

The total amount of a product (good or service) available for purchase at any specified price.

• Supply

• Demand

• Equilibrium

• producers

The quantity demanded and quantity supplied are equal. There is neither a surplus or a shortage.

• Supply

• Demand

• Equilibrium

• free market

Law of Demand

• the quantity supplied of a good rises when the price of the good rises

• the quantity demanded of a good falls when the price of the good rises

• business will supply what the consumers demand

• the lower the price, the more popular it will be

What is the market equilibrium price?

• 50 cents

• 60 cents

• 80 cents

• $1

What is the quantity supplied and demanded at the market equilibrium price?

• 2

• 6

• 8

• 10

At a price of $4, what is the quantity producers will supply?

• 60

• 50

• 30

• 10

What is the market equilibrium price for this product?

• ~ $1.50

• ~ $2.30

• ~ $1

• ~ $5

what will happen

• demand will increase

• supply will increase

• demand will decrease

• demand will contract

• demand will extend

what will happen

• D increase

• D decrease

• S increase

• S decrease

what will happen

• D increase

• D decrease

• S increase

• S decrease

• no change to the model