NAME SUPPLY AND DEMAND - 3.2.7 Law of Demand Quiz DIRECTIONS This quiz covers topics from today's lesson on the Law of Demand and is divided into two sections. In the first section, select the best answer for each question or incomplete statement. In the second section, correctly draw the indicated graphs. MULTIPLE CHOICE I) The Law of Demand states that when prices are 5) Which of the following events would cause relatively low, demand to increase? a) people are less likely to purchase goods or services. a ) Product goes out of style. b ) it is nearly impossible for companies to make money. b ) Price of a substitute good decreases. C ) demand is relatively high. c ) Price of a complementary good increases. d ) demand is relatively low. d) Consumers have more money. 2) The Law of Demand states that when prices are 6) Which of the following events would cause relative high, demand to decrease? a) people are more likely to purchase goods or services. a) Consumers leave the market. b) it is nearly impossible for companies to make money. b ) Product is a fad. C ) demand is relatively high. C) Consumers expect good things to happen in the future. (P demand is relatively low. d) Suppliers enter the market. (3) When the quantity demanded increases, it means that a ) a larger amount of goods are demanded because the price is lower than before. b) a larger amount of goods are demanded because the. price is higher than before. C) the entire demand curve has increased in value. d) the entire demand curve has decreased in value. 4) When demand decreases, it means that a) a smaller amount of goods are demanded. because the price is lower than before. b ) a smaller amount of goods are demanded because the price is higher than before. C ) the entire demand curve has increased in value. d) the entire demand curve has decreased in value. $ ECONOMICS Copyright @ 2013 N.S. PAGE