Answers2027 Ignite Financial Literacy-Personal Finance - EL3403The Law of Supply and Demand

Determining Market Price Answers

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1
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The graph shows excess demand.Which needs to happen in order to stop disequilibrium from occurring?

Question illustration
A
Q needs to be coordinated with supply.
B
Q needs to be coordinated with demand.
C
The price of goods needs to be increased.
D
The price of goods needs to be decreased.
2
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On a graph, an equilibrium point is where

A
a supply curve and a demand curve meet.
B
a supply curve is higher than a demand curve.
C
the supply and demand curves head up.
D
the supply and demand curves head down.
3

The graph shows demand.In order to achieve equilibrium, what else must be included on the graph?

Question illustration
d
disequilibrium
s
supply curve
e
excess supply
e
excess demand
4

What happens when the quantity of a good supplied at a given price is greater than the quantity demanded?

e
excess supply
s
stable prices
e
exact equilibrium
i
increased production
5

Which explains the connection between the law of demand and excess demand?

A
The law states that decreases in price leads to greater quantity demanded and limited supply, which occurs during excess demand.
B
The law states that increases in price increases leads to greater quantity demanded and limited supply, which occurs during excess demand.
C
The law states that decreases in price leads to greater supply and equilibrium, which occurs during excess demand.
D
The law states that increases in price leads to greater supply and equilibrium, which occurs during excess demand.
6

Both excess supply and excess demand are a result of

e
equilibrium.
d
disequilibrium.
o
overproduction.
e
elasticity.
7

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8

The graph shows excess supply.Which needs to happen to the price indicated by p2 on the graph in order to achieve equilibrium?

Question illustration
I
It needs to be increased.
I
It needs to be decreased.
I
It needs to reach the price ceiling.
I
It needs to remain unchanged.
9

Supply and demand coordinate to determine prices by working

A
together.
B
competitively.
C
with other factors.
D
separately.
10

Which occurs during market equilibrium? Select two options.Supply and demand meet at a specific price.Supply is slightly greater than demand.Supply and demand meet at a specific quantity.Supply and demand meet at a demand point.Supply and demand meet at a supply point.

A
Supply and demand meet at a specific price.
B
Supply is slightly greater than demand.
C
Supply and demand meet at a specific quantity.
D
Supply and demand meet at a demand point.
E
Supply and demand meet at a supply point.

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