. Who gets the goods and services produced in our economy?

Whoever is willing and able to pay the price

How do producers answer the economic question of what to produce in a market economy?

They produce products that are the most profitable.

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LAP EC 012

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Questions 10

Answers

1
What is one factor that will determine how much a customer is willing to pay for a good or service?
Rationing
Production cost
Buying power
Incentive
2
. Who gets the goods and services produced in our economy?
Whoever is most efficient
Whoever has the least costs
Whoever is willing and able to pay the price
Whoever obtains the most information and incentives
3
How are prices used in our economy?
To encourage excess supply
To encourage excess demand
To ration limited resources
To provide equilibrium in the market
4
Prices set higher than the equilibrium price will result in
excess supply.
excess demand.
increased profits
decreased supply.
5
How do producers answer the economic question of what to produce in a market economy?
They produce products for which they have the most information.
They produce products that are the most profitable.
They produce products that cost them the most to produce.
They produce products that provide the least incentives.
6
How much a consumer is willing to pay for a product depends partly on the consumer’s opinion of the product’s
efficiency
production costs
target market
vaule
7
What do producers often do when supply is greater than demand?
Lower prices
Increase quality
Increase prices
Lower quality
8
What usually happens to the demand for a good or service when the price increases?
It decreases.
it increases
stays the same
It varies
9
What exists when producers produce more than buyers are willing and able to buy?
Excess supply
Excess demand
Normal price
Equilibrium price
10
When supply is greater than demand, a __________ often develops.
Price ceiling
Seller’s market
Buyers Market
Shortage

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