Supply & Demand

 _______ refers to how many good and services consumers are willing to buy at a certain price

• Supply

• Demand

• Products

• Price

Would the demand increase or decrease if the price of a cup of coffee went from $3 to $8?

• Decrease

• Increase

• Stay the same

TRUE or FALSE: The law of demand states that the higher the price, the higher the quantity demanded.

• True

• False

TRUE or FALSE: The law of demand states that the higher the price, the higher the quantity demanded.

• True

• False

What is the profit if it costs the owner $1.20 for coffee beans for one cup of coffee and he sells coffee for only $1?

• -$0.20

• $0.20

• -$2.00

• $2.00

If the coffee beans (cost of production) go from $1.20 to $2, will the coffee shop owner increase or decrease supply?

• increase

• decrease

• stay the same

TRUE or FALSE: The supply curve shifted because the shop owner had to increase the price of coffee.

• TRUE

• FALSE

What would be the reason for the change in demand if people stopped drinking coffee because they thought it was unhealthy?

• 
  

  A change in population

• 
  

  A change in price

• A change in tastes

• A change in income