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WorksheetsLaw of Supply and Demand
Total questions: 56
Worksheet time: 39mins
Name
Class
Date
1.
Thousands of people leave a small town due to a factory closing down. Sales at the local grocery store become slow. What causes this change?
a)
Prices or availability of substitutes
b)
Prices or availability of complementary goods
c)
Change in the weather or season
d)
Change in the number of buyers
2.
New technology advances the rate at which furniture can be assembled. Why does this change the supply?
a)
Change in cost of production
b)
Changes in number of producers
c)
Changes in expectations
3.
The market equilibrium price is the price at which
a)
surpluses depress the number of goods supplied
b)
shortages and surpluses will have no effect on the market
c)
the government will not intervene in the market
d)
the quantity demanded is the same as the quantity supplied
4.
What is the Equilibrium Price?
a)
1
b)
2
c)
3
d)
4
5.
When there is a shortage the price will usually?
a)
rise
b)
fall
c)
remain the same
d)
equilibrium
6.
Goods that are bought and used together are
a)
complementary goods
b)
substitute goods
c)
income goods
d)
unrelated goods
7.
Which of the following is likely to increase the demand for peanut butter?
a)
Fewer children in the population
b)
News that insects have destroyed much of the peanut crop and that there will be less peanut butter on the shelves in three months.
c)
A big increase in the price of jelly.
d)
A report from the Surgeon General of the United States that eating peanut butter makes people nutty.
8.
The diagram represents a
a)
increase in demand
b)
decrease in demand
c)
change in quantity demand
d)
none of the above
9.
The Law of Demand says that price and quantity have a(n)
a)
direct relationship
b)
inverse relationship
c)
marginal utility
d)
diminishing utility
10.
Inferior goods react ___________ to income shifts.
a)
directly
b)
sometimes
c)
constantly
d)
inverse
11.
The law of demand states that if the price of CD’s rise, consumers will
a)
Buy more CDs
b)
Buy fewer CDs
c)
Quantity demanded will not change
12.
What does a “surplus” (extra amount) of goods in a market imply?
a)
Prices are too high
b)
Prices are too low
c)
Supply is too low
d)
Demand is too high
13.
The United States imports many cars from Japan. Suppose that the price of material(s) that Japan uses in making cars declines. What is the INITIAL (first) effect this will have on the Japanese car manufacturers?
a)
The input costs of Japanese made cars to the US will increase
b)
The quantity supply of Japanese made cars sold in the US will decrease
c)
The input costs of Japanese made cars in the US will decrease
d)
The quantity demand of Japanese made cars sold in the US will decrease
14.
Americans revive their love of SUV’s and the newly remodeled, but still “gas guzzling” Hummer. What happens to the market for gasoline?
a)
Demand for gasoline will decrease
b)
Demand for gasoline will increase
c)
Demand for gasoline will stay the same
15.
In an attempt to increase the production of oil and gasoline, Congress and the President have given the okay to drill in the Alaskan Arctic Preserve. What happens to the market for gasoline?
a)
Supply for gasoline will decrease
b)
Supply for gasoline will increase
c)
Supply for gasoline will stay the same
16.
Which statement expresses a central idea of how the laws of supply and demand work?
a)
The government sets the prices for goods and services.
b)
Prices are determined by the interaction of producers and consumers.
c)
Consumers alone determine the prices for goods and services.
d)
Technology dictates the prices charged for goods and services.
17.
Mr. Williams goes to the ticket booth to buy tickets for an Atlanta Braves game. Mr. Williams is told that the game is sold out and no tickets are available. Which best explains why there are no baseball tickets available?
a)
The arena forgot to print enough tickets.
b)
The supply of tickets was greater than the demand.
c)
The arena charged too much money for each ticket.
d)
The demand for tickets was greater than the supply.
18.
When companies compete in a market economy, what is usually the result?
a)
Consumers are able to buy goods for the best available price.
b)
People pay much higher prices for goods.
c)
There are frequent shortages of goods on the market.
d)
Producers refuse to sell some of their products.
19.
Local stores sell a particular pair of sneakers for $80. A picture of a basketball star Lebron James wearing these sneakers appears in all the local Ohio newspapers. The next day, sales for sneakers start to rise.
What is likely to happen to the price of the sneakers over the next several weeks?
What is likely to happen to the price of the sneakers over the next several weeks?
a)
People will refuse to buy these sneakers.
b)
The price for the sneakers will not change.
c)
The price will fall as people learn Lebron James wears them.
d)
The price of the sneakers will rise as more people want similar sneakers.
20.
Read the following situation to determine what the outcome would be:
A new type of television set uses 3-D images. many stores will have large quantities of the older style televisions. What will happen to the price of these older televisions?
A new type of television set uses 3-D images. many stores will have large quantities of the older style televisions. What will happen to the price of these older televisions?
a)
The price will remain the same.
b)
The price will rise.
c)
The price will fall.
21.
Read the following situation to answer the question:
The yeast needed to to make whole wheat bread rises sharply in price. What will happen to the price of whole wheat bread?
The yeast needed to to make whole wheat bread rises sharply in price. What will happen to the price of whole wheat bread?
a)
The price will rise.
b)
The price will stay the same.
c)
The price will fall.
22.
The price at which the quantity demanded by consumers equals the quantity suppled by the producers is know as what?
a)
Competition
b)
The Law of Supply
c)
The Law of Demand
d)
The Equilibrium Price
23.
This term refers to how much of a good or service consumers are willing to buy at a particular price.
a)
Demand
b)
Compettition
c)
Supply
d)
Equilibrium Price
24.
This part of the market determines DEMAND
a)
buyers
b)
sellers
c)
suppliers
d)
store owners
25.
This part of the market determines SUPPLY
a)
buyers
b)
sellers
c)
consumers
d)
us
26.
What does this curve represent?
a)
supply
b)
equilibrium
c)
demand
d)
surplus
27.
When the demand for a product or service is higher than the supply this causes what?
a)
shortage
b)
consumer
c)
surplus
d)
equilibrium
28.
The quantity of a good or service that producers are able and willing to offer for sale at a specified price in a given period of time is
a)
supply.
b)
quantity sold.
c)
demand.
d)
quantity demanded.
29.
Demand is the desire and the __________ to buy a product or service
a)
need
b)
time
c)
plan
d)
ability
30.
If the price of printers goes down, what happens in the market for ink cartridges?
a)
Supply increases.
b)
Supply decreases.
c)
Demand increases.
d)
Demand decreases
31.
Printers and ink cartridges are typically purchased together. Economists would call these
a)
Stubstitues
b)
Complements
c)
Elastic
d)
Inelastic
32.
The following is a factor that will not cause the demand curve to shift:
a)
Advertising
b)
Population
c)
Price
d)
Consumer expectations
33.
If Michael Jordan did advertisements for Steak and Shake, this would cause the ___________ curve for Steak and Shake to shift ____________.
a)
demand.........right
b)
demand.........left
c)
supply.......right
d)
supply....... left
34.
What are the determinants of demand?( Select all that apply)
a)
Change in income
b)
Competition
c)
Change in number of buyers
d)
Change in consumer expectations
e)
Complementary Goods
35.
Which of the following is a determinant of supply.
a)
Change in input prices
b)
Change in technology
c)
Change in number of sellers
d)
Change in producer expectations
e)
All of the above
36.
When prices change, how is that reflected on a given supply or demand curve?( Select all the correct answers)
a)
When prices go up the demand curve moves to the right
b)
When prices go up the Supply curve moves to the left
c)
When prices go down the demand curve moves to the right
d)
When prices go down the Supply curve moves to the left
37.
If a determinant causes an increase in demand, the new demand curve will shift to the right of the original curve.
a)
True
b)
False
38.
If a determinant causes a decrease in supply, the new supply curve will shift to the left of the original curve.
a)
True
b)
False
39.
____________________ is the amount of a good that a company has.
a)
Supply
b)
Demand
c)
Good
40.
__________________ is the willingness and desire of a peson to buy a good.
a)
Supply
b)
Service
c)
Demand
41.
If the supply decreases and the demand increases then the price will ___________________.
a)
Decrease
b)
Increase
c)
Stay the same
42.
If the supply increases, but the demand decreases, then the price will _______________.
a)
Decrease
b)
Increase
c)
Stay the same
43.
Who determines the price of a good?
a)
The consumer
b)
The producer
c)
The distributor
44.
If the demand of a good and supply stays the same the price will _______
a)
Decrease
b)
Stay the same
c)
Increase
45.
When a company has more supply than demand this is known as a _______________.
a)
Equilibrium
b)
Shortage
c)
Surplus
46.
A person that takes a risk by starting a new business.
a)
human capital
b)
capital goods
c)
entreprenuer
d)
tariff
47.
The difference between a good and a service is that:
a)
Goods are available in unlimited quantaties and services are not
b)
Goods are tangible and services are not
c)
Services are available in unlimited quantaties and goods are not
d)
goods help satisfy unlimited wants and services do not
48.
If the price of printers goes down, what happens in the market for ink cartridges?
a)
Supply increases.
b)
Supply decreases.
c)
Demand increases.
d)
Demand decreases
49.
For the law of demand, as price rises, what happens to quantity demanded?
a)
it goes up
b)
it goes down
c)
it stays the same
d)
it is not effected
50.
For the law of supply, as price rises, what happens to quantity supplied?
a)
it goes up
b)
it goes down
c)
it stays the same
d)
it is not effected
51.
Part of the reason that LeBron James earns millions of dollars each year while school teachers may earn $30,000 is because…
a)
consumers enjoy basketball to the point that they are willing to spend lots of money and time attending games and watching commercials.
b)
the supply of superstar basketball players is low, while the supply of competent teachers is much larger.
c)
demand for LeBron James' talents is very high since he can generate so much revenue for a firm.
d)
all of the choices
52.
Which of the following could cause the price for automobiles to decrease?
a)
The local factory gives a big raise to its employees.
b)
None of the choices
c)
A brand new automobile dealership opens in town.
d)
The price of gasoline falls.
53.
The week before Halloween, pumpkin patches all around the country sell lots of pumpkins. What will happen to the price of pumpkins on the day after Halloween?
a)
The price will go up.
b)
The price will go down.
54.
The amount of a good or service that is available to consumers
a)
Supply
b)
Demand
c)
Saver
d)
Spender
55.
The point where supply and demand are balanced
a)
shifters
b)
equilibrium
c)
surplus
d)
shortage
56.
A drought has made this year's tomato harvest smaller than usual. What will probably happen to the overall supply of tomato sauce?
a)
The supply will probably go up
b)
The supply will probably go down
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