The Law of Supply and Demand

How might a drop in price for washing machines affect the demand for dryers?

(NOT SURE) The demand for dryers would most likely decrease as the price for washing machines dropped.

Which statement best explains the law of supply?

(NOT SURE) The quantity supplied by producers decreases as prices rise and increases as prices fall.

A market supply schedule shows

(NOT SURE) the prices and quantity in an entire market.

The total amount of a product available in a market at a given price is called the

supply.

A factor that most directly affects the demand for automobiles is

(NOT SURE) the individual tastes and preferences of buyers.

The graph examines the market for graphic T-shirts. Based on the graph, which event could cause the change shown?

(X) A product is restocked on store shelves and is ready for customer purchase.

How do changing prices affect supply and demand?

(X) As price increases, supply decreases, but demand increases.

Which statement best explains the law of demand?

(X) The quantity demanded by consumers increases as prices rise, then decreases as prices fall.

Which statement best compares the laws of supply and demand?

(X) The two economic laws work in practice. They apply to real-world economics eighty percent of the time.

How do lower prices tend to affect demand?

(X) They tend to decrease the interest in a product.

The graph examines the market for graphic T-shirts. The graph shows

(X) an increase in consumer interest in a product.

Which factor most directly affects a furniture company's supply?

(X) an increased interest in antique furniture over modern furniture

The chart compares the price of graphic T-shirts to the quantity demanded. This chart shows the link between

interest in a product and the price a consumer pays.

According to the law of demand, price and quantity move

along a track in opposite directions.

According to the law of supply, price and quantity move

along a track in opposite directions.

The point where supply and demand meet and prices are set is called

equilibrium.

The vertical axis of a demand curve shows

the price of a product.