Supply and Demand Review

The law of demand states that as a price increases, quantity demanded ________.

• Decreases
• Increases

• Remains Neutral

What causes an upward sloping supply curve?

• A positive relationship between price and quantity supplied.

• A neutral relationship between price and quantity supplied.

• An inverse relationship between price and quantity supplied.

What results in movement along the supply curve and demand curve?

• Change in technology

• Change in cost of resources

• Change in government subsidies

• Change in price

What term is defined as the intersection of supply and demand?

• Supply

• Demand

• Market

• Equilibrium

The law of supply states that as a price increases, quantity supplied ________.

What is a government subsidy?

• Removal of all taxes for businesses

• A tax break for a business

• Discount on resources for businesses

• A tax increase for a business

What label is on the horizontal axis of a supply graph?

• Quantity Demanded

• Production Number

• Price

• Quantity Supplied

What causes a downward sloping demand curve?

• A positive relationship between price and quantity demanded.

• A neutral relationship between price and quantity demanded.

• An inverse relationship between price and quantity demanded.

What is it called when quantity demanded is larger than quantity supplied?

• Shortage

• Surplus

• Price Floor

• Price Ceiling

What is it called when quantity supplied is larger than quantity demanded?

• Shortage

• Surplus

• Price Floor

• Price Ceiling