Demand and Supply

What is 'effective demand'?

• The quantity of a product available for sale

• The desire for a product coupled with the ability and willingness to pay

• The ability to pay for a product

• The desire for a product

What is 'elasticity of supply'?

• The change in price in response to a change in demand

• The change in demand in response to a change in price

• The change in supply in response to a change in price

• The change in price in response to a change in supply

What is 'elasticity of demand'?

• The change in demand in response to a change in price

• The change in supply in response to a change in price

• The change in price in response to a change in demand

• The change in price in response to a change in supply

What does the Law of Demand state?

• The demand for a product varies directly with its price

• The demand for a product varies inversely with its price

• The demand for a product is determined by the quantity available

• The demand for a product is constant regardless of its price

The desire or willingness a consumer has to purchase a good or a service is called:

• demand

• shortage

• supply

• price

The amount of a good or service that is available to consumers:

• supply

• demand

• service

• product

Cold weather in Florida has damaged this year’s orange crop. Farmers have only half of the usual amount of oranges to sell. What will happen to the price of oranges?

• The price will increase

• The price will decrease

When the demand for a product or service is higher than the supply this causes what?

• shortage

• surplus

• consumer

• equilibrium

When prices increase, the quantity demanded:

• decreases

• increases

• stays the same

When the price of Nike brand shoes increases, we will probably go purchase a brand like Adidas or Pumas instead. Which of the following best explains this behavior?

• Substitution Effect

• Price Gouging

• Monopoly

• Incentives