Supply & Equilibrium Quiz – Extracted Questions

According to the Law of Supply, what will producers most likely do if the price of a product increases?

• Produce less

• Produce more

• Decrease demand

• Stop production

If the cost of ingredients used to make pizza increases, what will most likely happen to the supply of pizza?

• Supply will increase

• Supply will decrease

• Demand will increase

• Quantity demanded will increase

Which situation represents a change in quantity supplied?

• A new tax increases production costs

• The price of the product rises and producers make more

• New technology lowers production costs

• Government regulations limit production

If supply increases while demand stays the same, what will most likely happen to equilibrium price?

• Price will increase

• Price will decrease

• Price will stay the same

• Demand will increase

A surplus occurs when:

• Quantity demanded exceeds quantity supplied

• Quantity supplied exceeds quantity demanded

• Supply equals demand

• Prices fall below equilibrium

A shortage occurs when:

• Quantity demanded exceeds quantity supplied

• Quantity supplied exceeds quantity demanded

• Prices are above equilibrium

• Supply increases

If the market price is set above equilibrium, what will most likely happen?

• Shortage

• Surplus

• Demand increase

• Supply decrease

If the market price is below equilibrium, which condition will most likely occur?

• Surplus

• Shortage

• Supply increase

• Demand decrease

When a producer decides to supply more goods because the price has increased, this represents:

• A shift in supply

• A movement along the supply curve

• A shift in demand

• Market equilibrium

If a new machine makes it cheaper to produce shoes, what will most likely happen to the supply of shoes?

• Supply will increase

• Supply will decrease

• Demand will decrease

• Quantity demanded will increase