Chapter 8 - How does our economy work?

Question 1

A market is

Answer 1

any place where buyers and sellers come together.

Question 2

An example of a market is a

Answer 2

farmers market.

Question 3

Economy is

Answer 3

how things are bought and sold in a community.

Question 4

A seller is

Answer 4

an individual who sells goods or services.

Question 5

Markets bring together people who

Answer 5

have different goals in mind. Sellers want prices as high as possible; buyers want prices as low as possible.

Question 6

Supply is

Answer 6

the total amount of a product for sale.

Question 7

Demand is

Answer 7

the total amount of a product that customers are willing to buy at a certain price.

Question 8

Supply and demand affect the

Answer 8

price of a product.

Question 9

Sellers compete with other sellers by

Answer 9

making their prices lower to attract buyers.

Question 10

How can customers compete with one another for a product?

Answer 10

They need to be willing to pay more money for a product than other customers when supply is low.

Question 11

What happens when the demand for something is greater than supply?

Answer 11

Prices are raised because sellers know customers will pay more for a product if there was less than it.

Question 12

What can sellers do when the supply is greater than the demand?

Answer 12

lower the price of a product

Question 13

The supply of a product can change because of

Answer 13

• weather
• customer interest
• a celebrity/famous person promotes it.