Supply and Demand

What is the key to markets?

• Money

• Voluntary Exchange

• Involuntary Exchange

• Businesses

What is a voluntary exchange?

• Buyers and sellers begrudgingly make a transaction.

• Buyers and sellers willingly make a transaction.

What happens to the price of strawberries if farmers produce too many?

What happens to the price of strawberries if the farmer doesn't produce enough?

What are price signals?

• The advertisements that companies make that tell you the price for goods.

• The information that the government generates to guide a distribution of resources.

• The information that the market generates to guide a distribution of resources.

What do markets incentivize?

• Money making schemes.

• The production of low quality goods.

• The production of goods.

• The production of high quality goods.

When the price goes up, producers want to make more, when the price goes down, producers want to make less is an example of what?

• Law of demand

• Law of supply

What is shown by a downward sloping curve?

• Law of demand

• Law of supply

When the price goes up, people buy less, when the price goes down, people buy more is an example of what?

• Law of demand

• Law of supply

What is shown by a upward sloping curve?

• Law of supply

• Law of demand