Supply and Demand

What is a key to markets?

• Idea of forced exchange

• Idea of involuntary exchange

• Idea of voluntary exchange

When price goes up, demand goes ​ (a)   .

• down
• up

When price goes up, supply goes ​ (a)   .

• up
• down

Answer explanation

When the item (let's say strawberries) are more expensive, more people want to grow them because they'll make money.

When there is a higher supply for strawberries than the demand of strawberries, it is called

• surplus
• excess

• shortage
• equilibrium

When the demand for strawberries is higher than the supply, it is called...

• a surplus
• equilibrium
• market failure
• a shortage

Why does the supply curve move to the left for strawberries in the winter time?

• • It is easier to grow strawberries in the winter so there's a large supply.

• • It is harder to grow strawberries in the winter so there's less supply.

• Strawberries are harvested year-round, so the supply remains constant.

Why did prices for gas decrease so much in 2014?

• An increase in supply and a decrease in demand.

• An increase in demand and a decrease in supply.

• An increase in supply and an increase in demand.