Exploring Supply and Demand Concepts

The video explains the laws of supply and demand, which determine the prices of goods and services. It covers how supply is the amount of a product available, while demand is how much people want it. The video uses the video game industry as an example to illustrate these concepts, showing how prices are set based on supply and demand. It also explains the equilibrium point where supply equals demand, leading to market clearing. The video concludes with a practical example of how these principles affect everyday purchases.

What are the two main factors that determine the price of goods and services?

• Demand and availability

• Supply and demand

• Demand and quality

• Supply and quality

Which of the following is considered a service?

• Houses

• Oranges

• Books

• Car washing

What does 'supply' refer to in the context of economics?

• The amount of money available

• The amount of a good or service that exists

• The number of consumers

• The quality of a product

What happens to the quantity demanded when a product becomes more expensive?

• It increases

• It decreases

• It fluctuates

• It stays the same

Why might companies increase production of a product?

• To reduce costs

• To meet higher demand

• To decrease prices

• To improve quality

What is the term for the amount of a product that producers are willing to sell at a particular price?

• Market supply

• Market demand

• Quantity demanded

• Quantity supplied

What drives producers to push prices up?

• Desire to reduce supply

• Desire to increase demand

• Desire to make money

• Desire to save money

What is the equilibrium point in a market?

• Where supply equals demand

• Where demand exceeds supply

• Where supply exceeds demand

• Where prices are highest

What happens when the demand for a product becomes greater than the supply?

• Supply decreases

• Prices increase

• Prices decrease

• Demand decreases

What is the result when the supply and demand balance out in a market?

• Prices become unstable

• The market has cleared

• Supply exceeds demand

• The market crashes