Supply
This happens when too much of a product is available.
Surplus
The amount it costs to buy something.
What is price?
Supply comes primarily from what group?
What are producers/firms/companies?
A demand curve shows the relationship between what two things?
What is price and demand?
This happens when there is not enough of a product available.
Shortage
If the price of milk is expected to rise in October, what will be the impact on supply for milk in September?
The supply will DECREASE for the month of September
This is the price where supply and demand are the same.
What is equilibrium?
If a business produces too much, they may end up with this.
What is surplus?
The demand curve usually slopes in this direction.
A surplus usually causes prices to do this.
What is decrease/fall?
This helps businesses predict how much of a product consumers will want.
What is demand forecasting?
T/F: High Supply usually results in the decrease of price.
What is true?
Higher prices may encourage this to happen in a market.
A shortage usually causes prices to do this.
What is increase/rise?
Explain why prices rise when demand increases but supply remains the same.
Because more people want the product but there isn’t more available, creating a shortage.
People changing their spending habits because the price of milk increased is an example of _______.
What is elasticity?
If demand decreases but supply stays the same, what happens and why?
A surplus occurs and prices fall because fewer people want the product.
What does a less steep demand curve show about elasticity?
That small price changes cause large changes in demand.
If demand decreases but supply stays the same, what happens and why?
A surplus occurs and prices fall because fewer people want the product.
Why is the law of supply and demand important for businesses?
What is, it helps them decide how much to produce and what price to charge to avoid surplus or lost profits?
T/F: Surplus of product happens in high consumer demand situations.
What is false?