Question 1

Price reductions will usually result whenever the quantity supplied exceeds the quantity demanded at the current price.

Accepted Answer

This is the basic law of supply and demand. When there is an excess supply of a product or service, sellers will usually lower their prices in order to move their inventory or meet their sales targets. This creates a market equilibrium where the quantity demanded equals the quantity supplied at a lower price point.

Question 2

When the price of a good or service changes

Accepted Answer

When the price of a good or service changes, there is a movement along a given demand curve. This is because the quantity demanded changes in response to the price change, but the other factors that influence demand (such as income, taste, and availability of substitutes) remain constant. Therefore, the demand curve itself does not shift.

Question 3

An increase in the price of a good will

Accepted Answer

According to the law of demand, an increase in price will lead to a decrease in quantity demanded. Therefore, the correct answer is D - a price increase will decrease the quantity demanded, not increase it.

Question 4

"Other things equal,when the price of a good rises,the quantity demanded of the good falls,and when the price falls,the quantity demanded rises." This relationship between price and quantity demanded is referred to as

Accepted Answer

The statement describes the basic principle of the law of demand, which states that there is an inverse relationship between the price of a good and the quantity demanded, ceteris paribus. As the price of a good rises, consumers will typically reduce their demand for that good, and vice versa. This is a fundamental concept in economics, and is often used to analyze consumer behavior and market outcomes.

Question 5

Which of these statements best represents the law of demand?

Accepted Answer

The law of demand states that there is an inverse relationship between the price of a good and the quantity demanded of that good, meaning that as the price of a good decreases, buyers will purchase more of that good. Option A refers to a change in tastes, which may lead to a change in demand, but does not address the law of demand. Option B refers to a change in the consumer population, which may lead to a change in demand, but again does not address the law of demand. Option D is a true statement, but does not best represent the law of demand.

Question 6

Which of the following relationships reflect the law of supply?

Accepted Answer

The law of supply states that as the price of a good increases, the quantity supplied by producers also increases. Therefore, the relationship that reflects this law is a positive relationship between price and quantity supplied. In option C, the arrow points from price (P) to quantity supplied (Q_S), indicating that an increase in price results in an increase in quantity supplied, which is consistent with the law of supply.

Question 7

The quantity demanded of a good is the amount that buyers are

Accepted Answer

The quantity demanded of a good refers to the amount of the good that buyers are both willing and able to buy at a given price. While need may play a role in a buyer's decision to purchase a good, it is not a requirement for quantity demanded. Therefore, option B is the best choice as it encompasses both willingness and ability to purchase.

Question 8

In economics,the demand for a good refers to the amount of the good people:

Accepted Answer

Demand refers to the quantity of a good that consumers are willing and able to buy at different prices. This means that demand is not just based on people's desire for the good (as in A), but also on their ability and willingness to pay for it. Demand can also change based on changes in income (as in D), but it is not necessarily tied to a minimum standard of living (as in C).

Question 9

The law of demand refers to the:

Accepted Answer

The law of demand states that there is an inverse relationship between the price of a good and the quantity demanded. As the price of a good increases, the quantity demanded decreases, and vice versa. So, option C correctly defines the law of demand. Option A is incorrect because the decrease in price actually stimulates demand, rather than being a result of it. Option B is incorrect because an increase in demand for a good of limited supply would result in an increase in the price, not the other way around. Option D is incorrect because as the price of a good increases, the quantity supplied (not made available) for sale also increases.

Question 10

Which of the following is not held constant along a given demand curve?

Accepted Answer

Along a given demand curve, the price is the independent variable and changes as we move along the curve. The other factors such as income, tastes, and expectations are assumed to be constant.

Question 11

The law of demand illustrates a(n)____ relationship between price and ____.

Accepted Answer

The law of demand states that there is an inverse relationship between price and quantity demanded - as the price of a good or service increases, the quantity demanded of that good or service decreases, and vice versa. Therefore, choice B, inverse relationship between price and quantity demanded, is the correct answer. Choices A, C, and D are all incorrect.

Question 12

An increase in quantity demanded

Accepted Answer

An increase in quantity demanded means that consumers are willing to buy more of a particular good at the same price. This is illustrated by a movement downward and to the right along a demand curve, as the quantity demanded on the x-axis increases while the price on the y-axis remains the same. A shift in the demand curve, on the other hand, would mean a change in the entire demand relationship due to factors such as changes in consumer preferences or income.

Question 13

A decrease in the price of a good will

Accepted Answer

A decrease in the price of a good will lead to an increase in the quantity demanded of that good. However, it will not necessarily increase the overall demand for the good as a decrease in price does not necessarily lead to a change in consumer preferences or income levels.

Question 14

If the market for wheat is in equilibrium,the quantity of wheat demanded will equal the quantity of wheat supplied.

Accepted Answer

In a market equilibrium, the quantity of a good demanded is equal to the quantity supplied at a particular price, indicating that the market is efficient and there are no shortages or surpluses of the good. Therefore, the statement is true.

Question 15

Which of the following is true of a competitive market?

Accepted Answer

In a competitive market, buyers and sellers have little market power as there are many buyers and sellers offering similar products, making it difficult for any one buyer or seller to influence the market price.

Question 16

The law of demand asserts that:

Accepted Answer

The law of demand states that the quantity of a good that people will buy is inversely related to the product's price. This means that as the price of a good increases, the quantity demanded decreases, and vice versa. Option A is incorrect as the law of demand focuses on prices of goods and not input prices. Option B is incorrect as the willingness to pay for a good does not always translate into actual purchases. Option C is incorrect as the demand for a good is not solely based on its prestige or high price.

Question 17

The law of demand states that,ceteris paribus,an increase in

Accepted Answer

The law of demand states that, ceteris paribus (all else being equal), an increase in price will result in a decrease in the quantity demanded of a good or service. In other words, as the price of a good or service increases, consumers will demand less of it. Therefore, choice B is the correct answer.

Question 18

A downward-sloping demand curve illustrates

Accepted Answer

A downward-sloping demand curve illustrates the law of demand, which states that as the price of a good or service decreases, the quantity demanded of that good or service will increase, all other factors being equal.

Question 19

A decrease in quantity demanded

Accepted Answer

A decrease in quantity demanded is illustrated by a movement upward and to the left along a demand curve, reflecting a lower quantity being demanded at a higher price.

Question 20

A decrease in the price of a good would

Accepted Answer

The answer of A decrease in the price of a...

Quiz 4: Demand, Supply, and Market Equilibrium

Price reductions will usually result whenever the quantity supplied exceeds the quantity demanded at the current price.

When the price of a good or service changes

An increase in the price of a good will

"Other things equal,when the price of a good rises,the quantity demanded of the good falls,and when the price falls,the quantity demanded rises." This relationship between price and quantity demanded is referred to as

Which of these statements best represents the law of demand?

Which of the following relationships reflect the law of supply?

The quantity demanded of a good is the amount that buyers are

In economics,the demand for a good refers to the amount of the good people:

The law of demand refers to the:

Which of the following is not held constant along a given demand curve?

The law of demand illustrates a(n) relationship between price and .

An increase in quantity demanded

A decrease in the price of a good will

If the market for wheat is in equilibrium,the quantity of wheat demanded will equal the quantity of wheat supplied.

Which of the following is true of a competitive market?

The law of demand asserts that:

The law of demand states that,ceteris paribus,an increase in

A downward-sloping demand curve illustrates

A decrease in quantity demanded

A decrease in the price of a good would

Quiz 4: Demand, Supply, and Market Equilibrium

Price reductions will usually result whenever the quantity supplied exceeds the quantity demanded at the current price.

When the price of a good or service changes

An increase in the price of a good will

"Other things equal,when the price of a good rises,the quantity demanded of the good falls,and when the price falls,the quantity demanded rises." This relationship between price and quantity demanded is referred to as

Which of these statements best represents the law of demand?

Which of the following relationships reflect the law of supply?

The quantity demanded of a good is the amount that buyers are

In economics,the demand for a good refers to the amount of the good people:

The law of demand refers to the:

Which of the following is not held constant along a given demand curve?

The law of demand illustrates a(n) ____ relationship between price and ____.

An increase in quantity demanded

A decrease in the price of a good will

If the market for wheat is in equilibrium,the quantity of wheat demanded will equal the quantity of wheat supplied.

Which of the following is true of a competitive market?

The law of demand asserts that:

The law of demand states that,ceteris paribus,an increase in

A downward-sloping demand curve illustrates

A decrease in quantity demanded

A decrease in the price of a good would

The law of demand illustrates a(n) relationship between price and .