Economics Supply and Demand Review

Supply has a ________________ relationship between price and quantity supplied

• direct

• left

• right

• supply

the amount of “stuff” that is produced by firms and offered for sale.

• supply

• direct

• left

• the estimated amount of a given commodity (good or service) people will buy at different prices

When the demand curve shifts to the RIGHT this is called...

• an INCREASE in DEMAND

• slopes DOWNWARD to the RIGHT

• Coke & Pepsi

• a DECREASE in DEMAND

When the demand curve shifts to the LEFT this is called...

• a DECREASE in DEMAND

• an INCREASE in DEMAND

• Lefty loosey

• a change in price

Consumers buy more of a good when its price decreases and less of a good when its price increases. This is known as...

• The Law of Demand

• The Law of Supply

• Law and Order

• The Law of Equilibrium

When ONLY the price for a desired good increases or decreases & everything else remains the same...

• there is change in the QUANTITY DEMANDED

• there is change in the SUPPLY

• The Law of Demand

• there is change in the DEMAND

If the price of pizza drops, pizza becomes cheaper compared to other alternatives. Consumers will now purchase pizza instead of tacos, salads, etc., causing the quantity of pizza demanded to rise. This is known as...

• The Substitution Effect

• Skis & Ski boots

• a table that lists the quantity of a good a person will buy at each different price

• The Complimentay effect

What is the relationship between price and quantity demanded in the law of demand?

• Inverse

• Direct

• Neutral

• Variable

Which factor does NOT cause a shift in the demand curve?

• Change in consumer income

• Change in consumer preferences

• Change in the price of the good itself

• Change in the price of related goods

What happens to the supply curve when there is an improvement in production technology?

• Shifts to the right

• Shifts to the left

• Becomes vertical

• Becomes horizontal