Supply and Demand Review

Grace noticed that the price of coffee has increased. How might this affect the demand curve for tea, a related good?

• The demand curve for tea will shift to the right, indicating an increase in demand.

• The demand curve for tea will shift to the left, indicating a decrease in demand.

• The demand curve for tea will not be affected.

• The demand curve for tea can either shift to the left or right, depending on the nature of the change.

Ava noticed that when the price of her favorite ice cream increases, she tends to buy less of it. What economic principle does this scenario illustrate?

• The law of demand states that as the price of a good or service increases the quantity demanded for that good or service will decrease, assuming all other factors remain constant.

• The law of demand is the direct relationship between the price of a good or service and the quantity demanded for that good or service.

• The law of demand is not affected by any other factors.

• The law of demand only applies to luxury goods and services.

In a local farmers' market, what is the economic equilibrium?

• A state of balance where supply exceeds demand.

• A state of balance where demand equals supply.

• A state of balance where there is no demand or supply.

• A state of balance where demand exceeds supply.

Kai noticed that more people in his neighborhood are starting to prefer electric cars over gasoline cars. What is the impact of this change in consumer tastes and preferences on the demand curve for electric cars?

• Changes in consumer tastes and preferences shift the demand curve to the right, indicating an increase in demand.

• Changes in consumer tastes and preferences shift the demand curve to the left, indicating a decrease in demand.

• Changes in consumer tastes and preferences do not affect the demand curve.

• Changes in consumer tastes and preferences can either shift the demand curve to the left or right, depending on the nature of the change.

Abigail recently got a promotion and a significant raise at her job. What is the effect of this increase in her income on her demand for luxury goods?

• An increase in Abigail's income shifts the demand curve for luxury goods to the right, indicating an increase in demand.

• An increase in Abigail's income shifts the demand curve for luxury goods to the left, indicating a decrease in demand.

• A change in Abigail's income does not affect the demand curve for luxury goods.

• A change in Abigail's income can either shift the demand curve for luxury goods to the left or right, depending on the nature of the good.

How do changes in government regulations affect the supply curve in the context of a local bakery run by Michael?

• Changes in government regulations shift the supply curve to the right, indicating an increase in supply.

• Changes in government regulations shift the supply curve to the left, indicating a decrease in supply.

• Changes in government regulations do not affect the supply curve.

• Changes in government regulations can either shift the supply curve to the left or right, depending on the nature of the regulation.

Daniel is a farmer who grows corn. How does a change in future price expectations for corn affect Daniel's supply curve?

• A change in future price expectations shifts the supply curve to the right, indicating an increase in supply.

• A change in future price expectations shifts the supply curve to the left, indicating a decrease in supply.

• A change in future price expectations does not affect the supply curve.

• A change in future price expectations can either shift the supply curve to the left or right, depending on the nature of the expectation.

Daniel is a farmer who recently invested in a new irrigation technology. What is the impact of this technological advancement on his supply curve for crops?

• Technological advancements shift the supply curve to the left, indicating a decrease in supply.

• Technological advancements shift the supply curve to the right, indicating an increase in supply.

• Technological advancements do not affect the supply curve.

• Technological advancements can either shift the supply curve to the left or right, depending on the nature of the technology.

Nora is studying the factors that can cause a shift in the demand curve for electric cars. What factors should she consider?

• Political stability in the country

• Changes in consumer income, prices of related goods, consumer tastes and preferences, population demographics, and advertising and marketing efforts.

• Weather conditions

• Changes in producer income

Aria runs a lemonade stand. How does a surplus or shortage of lemons affect the market for her lemonade?

• Surplus and shortage both lead to an increase in price.

• Surplus and shortage have no effect on the market.

• Surplus leads to a decrease in price while shortage leads to an increase in price.

• Surplus leads to an increase in price while shortage leads to a decrease in price.