AnswersPersonal Finance and EconomicsThe Law of Supply and Demand

The Law of Supply and Demand — Quiz Answers

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1
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How do lower prices tend to affect demand?

A
They tend to decrease the interest in a product.
B
They tend to decrease the availability of a product.
C
They tend to increase the interest in a product.
D
They tend to increase the availability of a product.
2
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A factor that most directly affects the demand for automobiles is

A
the availability of workers in automobile factories.
B
the cost of raw materials and natural resources.
C
the individual tastes and preferences of buyers.
D
a company's ability to respond to buyers' interest.
3

Which statement best explains the law of supply?

A
The quantity supplied by consumers increases as prices rise and decreases as prices fall.
B
The quantity supplied by producers increases as prices rise and decreases as prices fall.
C
The quantity supplied by consumers decreases as prices rise and increases as prices fall.
D
The quantity supplied by producers decreases as prices rise and increases as prices fall.
4

According to the law of demand, price and quantity move

A
from the same point away from one another.
B
along a track in the same direction.
C
from different points toward one another.
D
along a track in opposite directions.
5

Which statement best compares the laws of supply and demand?

A
The two economic laws work in practice. They prove to be true in the real world one hundred percent of the time.
B
The two economic laws exist in theory. They have no relation to economics in the real world.
C
The two economic laws exist in theory. They work in practice, but real-world factors can have an effect.
D
The two economic laws work in practice. They apply to real-world economics eighty percent of the time.
6

The vertical axis of a demand curve shows

A
the production cost of a product.
B
the price of a product.
C
the supply of a product.
D
the interest in a product.
7

Which factor most directly affects a furniture company's supply?

A
a change in the price of rugs and other complementary goods
B
the growing number of furniture buyers in the market
C
the availability of raw materials and natural resources
D
an increased interest in antique furniture over modern furniture
8

Which statement best explains the law of demand?

A
The quantity demanded by consumers decreases as prices rise, then increases as prices fall.
B
The quantity demanded by consumers increases as prices rise, then decreases as prices fall.
C
The quantity demanded by producers decreases as prices rise, then increases as prices fall.
D
The quantity demanded by producers increases as prices rise, then decreases as prices fall.
9

The amount of goods and services consumers want is called the

A
demand.
B
supply.
C
count.
D
number.
10

How might a drop in price for washing machines affect the demand for dryers?

A
The demand for dryers would have no relation to the changing prices of washing machines.
B
The demand for dryers would most likely decrease as the price for washing machines dropped.
C
The demand for dryers would only be affected by an increase in the price of washing machines.
D
The demand for dryers would most likely increase as the price for washing machines dropped.
11

Which statement best compares the laws of supply and demand?

A
The two economic laws work in practice. They apply to real-world economics eighty percent of the time.
B
The two economic laws exist in theory. They have no relation to economics in the real world.
C
The two economic laws work in practice. They prove to be true in the real world one hundred percent of the time.
D
The two economic laws exist in theory. They work in practice, but real-world factors can have an effect.
12

According to the law of demand, price and quantity move

A
along a track in opposite directions.
B
from the same point away from one another.
C
along a track in the same direction.
D
from different points toward one another.
13

The amount of goods and services consumers want is called the

A
supply.
B
count.
C
demand.
D
number.
14

How might a drop in price for washing machines affect the demand for dryers?

A
The demand for dryers would have no relation to the changing prices of washing machines.
B
The demand for dryers would only be affected by an increase in the price of washing machines.
C
The demand for dryers would most likely increase as the price for washing machines dropped.
D
The demand for dryers would most likely decrease as the price for washing machines dropped.
15

Which statement best explains the law of demand?

A
The quantity demanded by producers increases as prices rise, then decreases as prices fall.
B
The quantity demanded by consumers increases as prices rise, then decreases as prices fall.
C
The quantity demanded by consumers decreases as prices rise, then increases as prices fall.
D
The quantity demanded by producers decreases as prices rise, then increases as prices fall.
16

A factor that most directly affects the demand for automobiles is

A
the availability of workers in automobile factories.
B
a company's ability to respond to buyers' interest.
C
the cost of raw materials and natural resources.
D
the individual tastes and preferences of buyers.
17

The vertical axis of a demand curve shows

A
the supply of a product.
B
the production cost of a product.
C
the interest in a product.
D
the price of a product.
18

Which statement best explains the law of supply?

A
The quantity supplied by consumers decreases as prices rise and increases as prices fall.
B
The quantity supplied by consumers increases as prices rise and decreases as prices fall.
C
The quantity supplied by producers increases as prices rise and decreases as prices fall.
D
The quantity supplied by producers decreases as prices rise and increases as prices fall.
19

Which factor most directly affects a furniture company's supply?

A
the growing number of furniture buyers in the market
B
an increased interest in antique furniture over modern furniture
C
the availability of raw materials and natural resources
D
a change in the price of rugs and other complementary goods
20

How do lower prices tend to affect demand?

A
They tend to decrease the interest in a product.
B
They tend to decrease the availability of a product.
C
They tend to increase the availability of a product.
D
They tend to increase the interest in a product.

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