Podcast Beta
Questions and Answers
A market is defined as a group of buyers and sellers of a particular good or service
True
Sellers determine the demand for a product.
False
The quantity demanded refers to the amount of a good that buyers are willing and able to purchase.
True
According to the law of demand, other things being equal, when the price of a good rises, the quantity demanded increases.
Signup and view all the answers
The market demand curve represents the sum of all individual demands for a product.
Signup and view all the answers
The demand schedule shows the relationship between the price of a good and the quantity demanded at that price.
Signup and view all the answers
A movement along the demand curve occurs when the price of the good changes while all other factors remain constant.
Signup and view all the answers
An increase in income always shifts the demand curve to the right.
Signup and view all the answers
If the price of a substitute good rises, the demand for the related good will increase.
Signup and view all the answers
An expected increase in future income will decrease current demand.
Signup and view all the answers
Study Notes
Market Definition
- A market consists of buyers and sellers of a specific good or service.
Demand
- Sellers do not determine demand.
- Quantity demanded is the amount of a product buyers are willing and able to purchase.
- Law of Demand: As the price of a good increases, the quantity demanded decreases, all else being equal.
- Market Demand Curve: Represents the total demand for a product, combining individual demands.
- Demand Schedule: Shows the relationship between a good's price and its quantity demanded at each price level.
- Movement along the demand curve: Occurs when only the price of the good changes, while other factors remain constant.
Demand Curve Shifts
- An increase in income generally shifts the demand curve to the right, indicating an increased demand.
- If the price of a substitute good (a good that can be used in place of another) rises, the demand for the related good will increase.
- An expected increase in future income may decrease current demand as consumers anticipate being able to purchase more in the future.
Studying That Suits You
Use AI to generate personalized quizzes and flashcards to suit your learning preferences.
Description
This quiz explores the fundamental concepts of markets, focusing on the dynamics between buyers and sellers of goods and services. Test your comprehension of what constitutes a market and its key components.
