Supply/Demand Practice

What does "Demand" refer to in economics?

• The quantity of a good or service that producers are willing to sell at different prices.

• The total amount of money a firm receives from selling goods or services.

• The quantity of a good or service that consumers are willing and able to buy at different prices.

• The additional revenue a firm earns from selling one more unit of a good or service.

According to the Law of Demand, what happens when the price of a good increases?

• The quantity demanded increases.

• The quantity demanded decreases.

• The quantity supplied decreases.

• The quantity supplied remains constant.

What does the Law of Supply state?

• As the price of a good increases, the quantity supplied decreases.

• As the price of a good increases, the quantity supplied increases.

• As the price of a good decreases, the quantity demanded increases.

• As the price of a good decreases, the quantity supplied remains constant.

What is the Equilibrium Price?

• The price at which the quantity supplied is greater than the quantity demanded.

• The price at which the quantity supplied equals the quantity demanded.

• The price at which the quantity demanded is greater than the quantity supplied.

• The price at which the supply curve intersects the demand curve.

What are Determinants of Supply?

• Factors that shift the demand curve, including consumer preferences and income.

• Factors that shift the supply curve, including input costs and technology.

• Factors that determine the equilibrium price and quantity.

• Factors that affect the elasticity of demand.

What is a Supply Curve?

• A graphical representation of the relationship between price and quantity demanded.

• A graphical representation of the relationship between price and quantity supplied.

• A graphical representation of the relationship between supply and demand.

• A graphical representation of the relationship between total revenue and marginal revenue.

What is Marginal Revenue?

• The total amount of money a firm receives from selling goods or services.

• The additional revenue a firm earns from selling one more unit of a good or service.

• The revenue a firm earns from selling all units of a good or service.

• The revenue a firm earns from selling half of its goods or services.

What are Economies of Scale?

• The increase in cost per item as production increases.

• The decrease in cost per item as production increases.

• The constant cost per item regardless of production level.

• The increase in total revenue as production increases.

What are variable costs?

• Costs that remain constant regardless of production.

• Costs that change depending on production levels.

• Costs that decrease with more production.

• Costs that are unrelated to production.

What is marginal cost?

• The cost of making one more item.

• The cost of the first item produced.

• The total cost of all items produced.

• The cost of labor only.