Supply and Demand Concepts Quiz

The opportunity cost of trading is the same for both parties, meaning there are no potential benefits to be gained from exchanging goods or services. This ultimately leads to no gains from trade and hinders economic growth.

The amount of a good or service that producers are willing and able to sell at a given price during a specific period.

The relationship between the price of a good or service and the total quantity producers are willing and able to sell at each price, given a specific timeframe.

A change in price causes a movement along the demand curve. This occurs when other factors influencing demand remain constant.

A shift in the demand curve happens when factors other than price change, leading to a change in consumers' overall willingness and ability to buy a product at every price.

Products that are used together, when the price of one good decreases, the demand for its complement increases.

Goods that are very similar and can be used interchangeably, if the price of one good decreases, the demand for its substitute decreases.

A product that is sold at a very low price, even below production cost to attract customers while expecting higher sales of complementary goods.

The relationship between the price of a good and the quantity supplied. As the price increases, producers are willing to supply more of the good.

A change in one of the non-price determinants of supply that causes the entire supply curve to shift. Examples include changes in the cost of production, technology, or the number of suppliers.

A movement along the given supply curve. This occurs when the price of the good changes.

Occurs when the quantity demanded is greater than the quantity supplied at a given price. This results in unmet demand and potential price increases.

The point where the supply and demand curves intersect. It represents the price and quantity where the market is in equilibrium, with no pressure to change.

The quantity of a good exchanged at the equilibrium price. Represents the amount both producers and consumers are willing to buy and sell.

A good whose demand decreases as income increases. Consumers tend to buy less of these goods when they become richer.

A good whose demand increases as income increases. Most goods fall into this category.

The non-price factors that influence the quantity supplied of a good. Examples include changes in the costs of production, technology, and the number of suppliers.

A situation where the quantity supplied exceeds the quantity demanded at a given price. This situation leads to a downward pressure on prices.

A situation where the quantity demanded exceeds the quantity supplied at a given price. This situation leads to upward pressure on prices.

The cost of producing a good or service.

A graph showing the relationship between price and quantity supplied, where each point represents a specific price and the amount producers are willing to provide at that price.

The point where the supply and demand curves intersect, representing the price at which the quantity supplied equals the quantity demanded.

The amount of a good or service that buyers are willing and able to purchase at a given price during a specific period.

A graph showing the relationship between price and quantity demanded, where each point represents a specific price and the amount buyers are willing to purchase at that price.

A situation where no one individual or group can influence the price of a good or service.

A shift in the demand curve to the right, indicating an increase in the quantity demanded at every price.

When the demand curve shifts to the left, indicating a decrease in the quantity demanded at every price.

Factors other than price that influence the demand for a good or service.