Demand & Law of Demand

When the price of good A rises, people start to drink good B. In this case, what is good B considered?

• luxury good

• complementary good

• substitute good

• normal good

What is the relationship between the Price and Quantity Demanded?

• Positive Relationship

• Direct Relationship

• Inverse Relationship

• Mixed Relationship

The diagram represents a

• increase in demand
• decrease in demand

The desire to have some good or service and the ability to pay for it

• supply

• equilibrium

• demand

• quantity demanded

The law of demand states; there is an INVERSE relationship between price and quantity demanded. Which of the following is not a true statement?

• Price goes up qty demanded goes down.

• Price goes down, qty demanded goes up.

• Price goes up, demand goes down.

• All answers are correct.

How is a decrease in the price of a good illustrated on a demand graph?

• The demand curve shifts to the right.

• The demand curve shifts to the left

• There is upward movement along the demand curve

• There is downward movement along the demand curve.

A change in the price of a good causes people to buy more or less of an item. This best describes the concept of

• the demand curve

• change in quantity demanded

• change in demand

• elasticity

Which of these best describes the law of demand?

• if prices go up, quantity demanded will fall and if prices go down, quantity demanded will go up

• if prices go up, quantity demanded will also go up and if prices go down, quantity demanded will also go down

• there is no law of demand, each situation is unique and demand and prices cannot be predicted

• prices will go up for certain goods when quantity demanded goes up and vice versa

If the price of Frozen Yogurt increased then the demand for ice cream will 

• increase
• decrease

A decrease in the average incomes of consumers will result in which of the following?

• A decrease in the demand for goods and services

• An increase in the demand for goods and services

• A decrease in the supply of goods and services

• An increase in the supply of goods and services