Economics Demand and Supply Quiz

The principle that shows the inverse relationship between the price of a good or service and the quantity demanded in a market.

The mathematical expression of demand, showing the inverse relationship between quantity demanded and price.

The quantity of goods or services that consumers are willing and able to purchase at a given price.

The slope of the demand curve, representing the negative change in quantity demanded as price increases.

All factors affecting price other than the price itself, such as income, fashion, or consumer preferences.

A Latin phrase meaning 'all else being equal', used to isolate the effect of one variable by assuming all other factors remain constant.

The price of the good or service.

The relationship between price and quantity demanded, where an increase in price leads to a decrease in quantity demanded, and vice versa.

A table that shows the relationship between the price of a good or service and the quantity demanded at each price.

The price at which a good or service is being traded in the market.

A change in the quantity demanded of a good or service due to a change in its price.

A change in the entire demand curve, meaning that at every price, consumers are willing and able to buy a different quantity.

The relationship between price and quantity demanded is inverse: as price goes up, quantity demanded goes down.

The point where the quantity demanded (Qd) and the quantity supplied (Qs) are equal. At this point, the market price is stable and neither a surplus nor shortage exists.

A mathematical equation that represents the relationship between the quantity supplied (Qs) and the price (P) of a good or service.

The price at which the quantity demanded and the quantity supplied are equal.

The quantity of a good or service that is bought and sold at the equilibrium price.

The process of finding the equilibrium price and quantity by setting the demand function equal to the supply function.

Expressing a demand function in terms of price (P) instead of quantity demanded (Qd).

Expressing a supply function in terms of price (P) instead of quantity supplied (Qs).

When the price of a substitute product decreases, the supply of the original product increases due to a shift in consumer preference.

When the price of a substitute product increases, the supply of the original product decreases, as consumers switch away from the more expensive option.

When the price of a complementary good increases, the supply of the original product decreases, as consumers are less likely to buy the original good without the complementary good.

When the price of a complementary good decreases, the supply of the original product increases, as consumers are more likely to buy the original good with the cheaper complementary good.

The principle that states that as the price of a good or service increases, producers are more likely to supply more of that good or service.

Changes in the price of related goods (substitutes or complements) can affect the supply of a product.

The supply of a product is influenced by factors like inputs, technology, government regulations, and expectations of future prices.

Supply changes happen when the entire supply curve shifts, meaning producers are willing and able to supply more or less at every price.

Factors that influence the quantity of goods or services producers are willing and able to supply, other than the price of the product itself.

The cost of resources used in production, such as raw materials, labor, and energy.

As input prices increase, production costs rise, making it less profitable to produce, so suppliers reduce the quantity supplied.

When input prices decrease, production costs fall, making it more profitable to produce, so suppliers increase the quantity supplied.

The prices of goods or services that are related to the production process, such as substitutes or complements.

Goods that can be used in place of each other. When the price of a substitute good increases, producers will likely increase the supply of the original good.

Goods that are used together. When the price of a complementary good increases, producers will likely reduce the supply of the original good.

The price of the product itself can also affect the quantity supplied. As the price rises, producers are incentivized to increase production, while lower prices lead to reduced production.

The relationship between the quantity of goods or services that consumers are willing and able to purchase and their income, where an increase in income leads to an increase in demand for normal goods.

The change in demand resulting from a change in the price of a substitute good. If the price of the substitute good increases, demand for the original good will rise.

The change in demand resulting from a change in the price of a complementary good. If the price of the complementary good increases, demand for the original good will fall.