Economics Quiz

____ are things that people would like to have, while ____ are things that people need to survive.

• Needs, wants

• Necessities, demands

• Supply, demand

• Wants, needs

When people want more than a company is willing to supply, that product will experience a ____, and the price of that product will _____.

• Surplus, decrease

• Surplus, increase

• Shortage, decrease

• Shortage, increase

When companies supply more than the consumers demand, that product will experience a ____, and the price of that product will _____.

• Surplus, decrease

• Surplus, increase

• Shortage, decrease

• Shortage, increase

According to the law of demand, when the price of a good or service ____, the demand for that same good or service will _____, and vice versa.

• Decreases, increase

• Decreases, stays the same

• Increases, increase

• Decreases, decreases

____ is the principle that additional satisfaction from a good or service decreases as more units are consumed.

• Rapidly decreasing utility

• Diminishing marginal utility

• Rapidly decreasing returns

• Diminishing marginal returns

Competing products are often called ____, because consumers can use one in place of the other.

• Demands

• Utilities

• Complements

• Substitutes

Which term refers to the extent to which a change in the price causes a change in demand?

• Demand elasticity

• Demand curve

• Demand schedule

• Market demand

If a product has ______ demand, any price changes have little effect on the quantity demanded, because it is usually a ______.

• Elastic, luxurious item

• Elastic, necessity

• Inelastic, luxurious item

• Inelastic, necessity

According to the law of supply, when the price of a good or service _____, the amount of supply for that same good or service will _______.

• Decreases, increase

• Decreases, stays the same

• Increases, increase

• Increases, decrease

If a product has _____ supply, any price/cost to produce changes have a great effect on the quantity supplied, because it is usually a product that is ________.

• Elastic, easy to produce

• Elastic, hard to produce

• Inelastic, easy to produce

• Inelastic, hard to produce