Supply and Demand Unit 2 Review ECO

What is the Equilibrium Price?

• 1

• 2

• 3

• 4

The diagram represents a(n)

• increase in supply

• decrease in supply

• change in quantity supplied

• none of the above

When the price of a product increases, there is

• shift in demand

• a change in elasticity of demand

• movement along the demand curve

• no effect on quantity demanded

On the demand curve, price and quantity demanded are

• inversely related

• directly related

• unrelated

• not relavant

During the Dust Bowl of the 1930's, many farmers agricultural goods were destroyed. What happened to the market for agricultural goods?

• Increase in demand

• Increase in supply

• decrease in supply

• decrease in demand

what is Law of Supply?

• When prices increase, quantity supplied increase

• When demand goes up, supply decrease

• Supply shifts to the right due to technology

• When prices go down people have an increased income

Which of the following explains the Law of Demand?

• When the price of a good increases, people tend to buy substitutes instead

• Unrelated

• People prefer inferior goods during a recession

• People often buy eggs and bacon together

Which of the following pairs of goods are substitutes?

• Jelly and Jam

• Eggs and Bacon

• Apples and Broccoli

• Mugs and Candles

Which of the following pairs of goods are complements?

• Jelly and Jam

• Eggs and Bacon

• Apples and Bananas

• Mugs and Candles

Assume peanut butter and Jelly are complementary goods. When the price of jelly increases, what will happen to the demand for peanut butter?

• It will decrease

• It will increase

• It will remain the same

• It will result in a surplus