Market Economics Quiz

What does a market refer to?

• Exchange of goods and services between buyers and sellers

• That place Mum and Dad take you to buy fruit

• Exchange of goods and services within a single company

• Exchange of goods and services within a government agency

Who are the buyers in the market?

• Financial institutions

• Consumers

• Producers

• Government agencies

Who are the sellers in the market?

• Non-profit organizations

• Labor unions

• Producers

• Consumers

What do consumers aim to do in the market?

• Maximize profits

• Minimize the quantity of goods and services demanded

• Maximize quantity of products produced

• Satisfy their needs and wants

Who are the individuals and businesses involved in the production of goods and services?

• Producers

• Financial institutions

• Government agencies

• Consumers

What does the circular flow model show about consumers and producers?

• Consumers rely on producers for resources

• Producers rely on consumers for resources

• Consumers rely on producers for goods and services

• Producers rely on consumers for goods and services

According to the law of demand, what happens when the price of a good or service increases?

• Consumer demand increases

• Consumer demand decreases

• Producer supply increases

• Producer supply decreases

According to the law of supply, what happens when the price a consumer is willing to pay for a good or service increases?

• Consumer demand decreases

• Consumer demand increases

• Producer supply decreases

• Producer supply increases

What is the response of producers to a market surplus?

• Increase prices

• Decrease prices

• Reduce production

• Expand production

What is the response of consumers to a market shortage?

• Expand consumption

• Reduce consumption

• Increase prices

• Decrease prices