Price Fluctuations and Pricing Strategies
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Questions and Answers

Who are the buyers in the market?

  • Consumers, businesses, and government (correct)
  • Only businesses
  • Only government
  • Only consumers
  • According to the theory of demand and supply, what determines the price and quantity sold of a commodity or service in a market economy?

  • The market mechanism
  • Both the demand and supply sides of the market (correct)
  • The supply side of the market
  • The demand side of the market
  • What are some examples of events that can cause prices to change in a market?

  • New discoveries and pandemics (correct)
  • Demand and supply
  • Changes in weather and wars
  • Market mechanism
  • What are the forces that make market economies work?

    <p>Demand and supply</p> Signup and view all the answers

    Why is it important for business firms to know how much of their products would be wanted by buyers during a given period of time?

    <p>To produce goods and services to be sold in the market</p> Signup and view all the answers

    According to the law of demand, what is the relationship between price and quantity demanded?

    <p>Inverse relationship</p> Signup and view all the answers

    Who worded the law of demand as 'When we say that a person's demand for anything increases, we mean that he will buy more of it than he would before at the same price, and that he will buy as much of it as before at a higher price'?

    <p>Alfred Marshall</p> Signup and view all the answers

    What does the demand curve represent?

    <p>The relationship between price and quantity demanded</p> Signup and view all the answers

    What is the shape of the demand curve?

    <p>Downward sloping</p> Signup and view all the answers

    What does the law of demand describe?

    <p>The direction of change in quantity demanded</p> Signup and view all the answers

    Which of the following best describes the law of demand?

    <p>There is an inverse relationship between price and quantity demanded.</p> Signup and view all the answers

    How does the law of demand describe the relationship between price and quantity demanded?

    <p>Price and quantity demanded move in opposite directions.</p> Signup and view all the answers

    According to the law of demand, what happens to quantity demanded when price increases?

    <p>Quantity demanded decreases.</p> Signup and view all the answers

    How is the law of demand represented on a graph?

    <p>Downward sloping curve</p> Signup and view all the answers

    What does the law of demand describe in terms of the quantity demanded?

    <p>Only the direction of change.</p> Signup and view all the answers

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