High School Economics Quiz: Demand Curve Changes (Micro Basics)

📚 Quick Study Guide

• 📈 Demand Curve: A graphical representation of the relationship between the price of a good or service and the quantity demanded for a given period of time.
• 💸 Price and Quantity: Typically, demand curves are downward sloping, meaning that as price increases, quantity demanded decreases (law of demand).
• ➡️ Shifts vs. Movements:
  • 🧭 Movement along the curve: Caused by a change in the price of the good itself.
  • ⚙️ Shift of the curve: Caused by changes in factors other than price (e.g., income, tastes, expectations, prices of related goods).
• 💡 Factors that Shift Demand:
  • 💰 Income: Normal goods (demand increases with income), Inferior goods (demand decreases with income).
  • 🎯 Tastes/Preferences: Changes in consumer preferences.
  • ⏳ Expectations: Expectations about future prices or availability.
  • 🛍️ Prices of Related Goods: Substitutes (goods used in place of one another), Complements (goods used together).
  • 👥 Number of Buyers: More buyers lead to higher demand.
• ✏️ Key Formulas: There aren't specific formulas for demand curve shifts, but understanding elasticity is helpful: $\text{Price Elasticity of Demand} = \frac{\% \text{ Change in Quantity Demanded}}{\% \text{ Change in Price}}$

🧪 Practice Quiz

1. What causes a movement *along* the demand curve?
   1. A) Change in consumer income
   2. B) Change in the price of a related good
   3. C) Change in the price of the good itself
   4. D) Change in consumer tastes


2. If consumer income increases, what happens to the demand for a normal good?
   1. A) Demand decreases
   2. B) Demand increases
   3. C) Demand remains the same
   4. D) The supply increases


3. Which of the following would *not* cause the demand curve to shift?
   1. A) A change in the price of a substitute good
   2. B) A change in consumer expectations
   3. C) A change in the price of the good itself
   4. D) A change in the number of buyers


4. If the price of gasoline increases, what is likely to happen to the demand for large, gas-guzzling SUVs?
   1. A) Demand will increase
   2. B) Demand will decrease
   3. C) Demand will remain the same
   4. D) Supply will decrease


5. Coffee and sugar are complements. If the price of coffee increases, what happens to the demand for sugar?
   1. A) Demand for sugar increases
   2. B) Demand for sugar decreases
   3. C) Demand for sugar remains the same
   4. D) The supply of sugar increases


6. What happens to the demand curve for pizza if a new study shows that eating pizza every day significantly improves cognitive function?
   1. A) The demand curve shifts left
   2. B) The demand curve shifts right
   3. C) The demand curve does not shift
   4. D) The supply curve shifts right


7. A local bakery announces that next week, all cookies will be sold at half price. What is likely to happen to the demand for the bakery's cookies this week?
   1. A) Demand will increase
   2. B) Demand will decrease
   3. C) Demand will remain the same
   4. D) Supply will increase