PLATO EDMENTUM ECONOMICS END OF
SEMESTER TEST FINAL STUDY GUIDE 2026
SOLVED QUESTIONS FULLY CORRECT
⫸ What are the conditions for a market to be perfectly competitive?
Answer: Good/service is highly standardized
Lots of buyers/sellers
All participants are well-informed abt market price
Ex: gasoline market
⫸ What is the law of demand? Answer: there is an inverse relationship
between price and quantity demanded (higher price = less quantity
demanded)
⫸ What is the demand curve? Answer: Graph that tells us the quantity
of a good that a buyer would be willing to buy at different price points.
⫸ How can we find the market demand curve of a product? Answer:
Add all quantities demanded at each respective price (think: mean)
⫸ What is a change in quantity demanded? Answer: movement along
the demand curve, amount of good that buyers are willing and able to
purchase
⫸ What is the factor that influences quantity demanded? Answer: Price
,⫸ What is a change in demand? Answer: Situation in which change in
the marketplace prompts consumers to buy different amounts of goods
or services at every price.
⫸ Describe demand curve shifts right/left Answer: If there is an
increase in demand, we say that the demand curve shifts right. If there is
a decrease in demand, we say that the demand curve shifts left. And so,
when the demand or the demand curve shifts, the quantity demanded
changes at every single price point.
⫸ What are the factors that may cause demand to change? Answer:
Income
Price of related goods
Tastes
Expectations
Number of buyers
⫸ What are normal goods? Answer: A good whose demand curve shifts
rightward when the incomes of buyers increase (and vice-versa).
⫸ What are inferior goods? Answer: A good whose demand curve shifts
leftward when the incomes of buyers increase (and vice-versa).
⫸ What are complements? Answer: Price of one good increases,
demand for other good decreases. (ex: coffee and creamer)
, ⫸ What are substitutes? Answer: Price of one good increases, demand
for other good increases. (ex: coca cola and pepsi)
⫸ How does taste influence change in demand? Answer: If the
perceived benefits of consumption change, so will the demand (ex:
organic foods)
⫸ How do expectations influence change in demand? Answer: Changes
expected to happen in th future can influence the demand of a good
today (ex: COVID toilet paper)
⫸ How does number of buyers affect change in demand? Answer: More
consumers leads to demand increasing and vice versa
⫸ What is the law of supply? Answer: an increase in price results in an
increase in quantity supplied (positive relationship between price and
quantity supplied)
⫸ How can we calculate market supply curve? Answer: Add all
quantities supplied at each respective price (think: mean)
⫸ What is change in quantity supplied? Answer: the change in amount
offered for sale in response to a change in price
SEMESTER TEST FINAL STUDY GUIDE 2026
SOLVED QUESTIONS FULLY CORRECT
⫸ What are the conditions for a market to be perfectly competitive?
Answer: Good/service is highly standardized
Lots of buyers/sellers
All participants are well-informed abt market price
Ex: gasoline market
⫸ What is the law of demand? Answer: there is an inverse relationship
between price and quantity demanded (higher price = less quantity
demanded)
⫸ What is the demand curve? Answer: Graph that tells us the quantity
of a good that a buyer would be willing to buy at different price points.
⫸ How can we find the market demand curve of a product? Answer:
Add all quantities demanded at each respective price (think: mean)
⫸ What is a change in quantity demanded? Answer: movement along
the demand curve, amount of good that buyers are willing and able to
purchase
⫸ What is the factor that influences quantity demanded? Answer: Price
,⫸ What is a change in demand? Answer: Situation in which change in
the marketplace prompts consumers to buy different amounts of goods
or services at every price.
⫸ Describe demand curve shifts right/left Answer: If there is an
increase in demand, we say that the demand curve shifts right. If there is
a decrease in demand, we say that the demand curve shifts left. And so,
when the demand or the demand curve shifts, the quantity demanded
changes at every single price point.
⫸ What are the factors that may cause demand to change? Answer:
Income
Price of related goods
Tastes
Expectations
Number of buyers
⫸ What are normal goods? Answer: A good whose demand curve shifts
rightward when the incomes of buyers increase (and vice-versa).
⫸ What are inferior goods? Answer: A good whose demand curve shifts
leftward when the incomes of buyers increase (and vice-versa).
⫸ What are complements? Answer: Price of one good increases,
demand for other good decreases. (ex: coffee and creamer)
, ⫸ What are substitutes? Answer: Price of one good increases, demand
for other good increases. (ex: coca cola and pepsi)
⫸ How does taste influence change in demand? Answer: If the
perceived benefits of consumption change, so will the demand (ex:
organic foods)
⫸ How do expectations influence change in demand? Answer: Changes
expected to happen in th future can influence the demand of a good
today (ex: COVID toilet paper)
⫸ How does number of buyers affect change in demand? Answer: More
consumers leads to demand increasing and vice versa
⫸ What is the law of supply? Answer: an increase in price results in an
increase in quantity supplied (positive relationship between price and
quantity supplied)
⫸ How can we calculate market supply curve? Answer: Add all
quantities supplied at each respective price (think: mean)
⫸ What is change in quantity supplied? Answer: the change in amount
offered for sale in response to a change in price
