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When prices are low people will buy more, and when prices are high they will buy less. Eve

ry shopkeeper knows this. But at the same time, producers want higher price for their goods when they make more goods. How can we find the best price for the goods? The Law of Supply and Demand is the economist's answer to this question.

According to this law, changes in the prices of goods cause change in supply and demand. An increase in the price of the goods causes an increase in supply-then number of goods the producers make. Producers will make more goods when they can get higher prices for the goods. The producer makes more shoes as the price of shoes goes up. At the same time, an increase in the price of the goods causes a decrease in demand—the number of goods the consumers buy. This is because people buy less when the price is high. People buy fewer shoes as the price of shoes goes up. Conversely, a decrease in the price causes an increase in demand (people buy more shoes) and a decrease in supply (producers make fewer shoes).

Business firms look at both supply and demand when they make decisions about price and production. They look for the equilibrium point where supply equals demand. At this point, the number of shoes produced is 3000 and the price of the shoes is $30. $30 is the equilibrium price: at this price the consumers will buy all of the 3000 shoes which the producers make. If the producers increase the price of the shoes, or if they produce more than 3000 shoes, the consumers will not buy all of the shoes. The producers will have a surplus(过剩)—more supply than demand—so they must decrease the price in order to sell all of the shoes. On the other hand, if they make fewer than 3000 shoes, there will be a shoes shortage —more demand than supply—and the price will go up.

According to the Law of Supply and Demand, the equilibrium price is the best price for the good. The consumers and the producers will agree on this price because it is the only price that helps them both equally.

Why does an increase in price cause an increase in supply? ______

A.Consumers buy more goods when prices are high.

B.Producers make more goods when prices are high.

C.Producers want to sell all of their goods.

D.Consumers will not buy all of the goods.

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更多“When prices are low people wil…”相关的问题
第1题
Modern mass-production (成批生产) methods lower the cost of making goods, and thus give us
Modern mass-production (成批生产) methods lower the cost of making goods, and thus give us better values. At the same time, American ingenuity (独创性) and science are constantly at work improving the quality of products. In this way, better quality products at good values are continually being brought to the people of all income (收入) groups.

As an example of how this works, when facial tissues (面巾纸) were first put on the market in 1924, they were made in limited quantities and sold at 65 cents per box of 200. People liked these facial tissues immediately and began asking for them when they went into different stores. Because there was such a demand for the product, manufacturers began making tissues in larger quantities, their production costs were lowered, so that the cost of tissues went down. In the meanwhile, the quality of facial tissues was constantly improving, because more manufacturers went into the business of making tissues, and each manufacturer strove to make his product better than his competitors'. Today, instead of costing 65 cents, a box of 200 tissues costs around one-third of that price, and they are both softer and stronger.

When people are free to compete when they are free to make more things and make them better everyone benefits.

1、In regard to the production of goods in greater quantities, the author states that ________.

A.the price of the goods should drop

B.the quantity of the goods should improve

C.the quality should rise and the price should drop

D.the price and quality should both rise

2、 lt can be inferred from the example that___.

A.increased demand led to mass production

B.facial tissues attracted much attention when first put on the market for their low prices

C.better quality resulted from mass production

D.lower price resulted in lower quality of the facial tissues

3、Improved quality of facial tissues resulted from ________.

A.mass-production methods

B.popular demand or a better product

C.a degrease in production costs

D.competition among manufacturers

4、According to the passage we can see that lower prices and better quality occur ________.

A.as a result of the effect of one on the other

B.always at the same time

C.independently of each other

D.when the demand exceeds the supply

5、The author believes that in a nation where free enterprise (自由企业制) exists, manufacturers will produce ________.

A.as much as they like

B.better quality goods

C.more than they are able to sell

D.both A and B

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第2题
When the prices of fuel go up increasingly.bunker adjustment factor can be charge
d.()

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第3题
When a war _____, the oil prices are likely to go up.

A.breaks off

B.breaks down

C.breaks out

D.breaks up

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第4题
The physical distribution of products has two primary aspects: transportation and stor
age.Both aspects are highly developed and specialized phases of marketing.The costs of both trans-porting and storing are built into the prices of products.Transportation can be by truck, rail-way, ship, or barge.For some items, such as exotic plants and flowers, or when rapid delivery is essential, air freight may be used.

Storage, or warehousing, is a necessary function because production and consumption of goods rarely match: items generally are not sold as quickly as they are made.Inventories build up,both in warehouses and at retail establishments, before the foods are sold.The transporta-tion function is involved in bringing goods to a warehouse and taking them from it to retail stores.

Storage performs the service of stabilizing market price.If, for example, no agricultural product could be stored, all food would have to be put on the market immediately.This would, of course, create a glut and lower prices drastically.There would be an immediate benefit to consumers, but in the long run they would suffer.Farmers, because of low prices, would be forced off the land, and the amount of food produced would decrease.This, in turn, would raise consumer prices.

Warehouses for storage are of several types.Private warehouses are owned by manufactur-ers.Public warehouses, in spite of their name, are privately owned facilities, but they are in-dependent of manufacturer ownership.General-merchandise warehouses store a great variety of products.Cold-storage warehouses store perishable goods, especially food products.Grain ele-vators are a kind of warehouse used to keep wheat and other grains from spoiling.A bonded warehouse is one that stores foods, frequently imported, on which taxes must be paid before theyare sold.Cigarettes and alcoholic beverages are common examples.

The distribution center is a more recently developed kind of warehouse.Many large com- panics have several manufacturing plants, sometimes located outside the country.Each plant doesnot make every company product but specializes in one or more of them.The distribution center allows a manufacturer to bring together all product lines in one place.Its purpose is to minimize storage and to ease the flow of goods from manufacturers to retailers rather than build up extensive inventories.It reduces costs by speeding up product turnover.Very large corporations will have several distribution centers regionally or internationally based

1.The main subject of this passage is______.

A、transportation and storage

B、storage of products

C、distribution center

D、two main aspects of product distribution

2.Warehousing is important in that ______.

A、inventories build up before the goods are sold

B、the prices will go down

C、more goods are produced than can be consumed

D、the food has to be put on the market immediately

3.How many types of warehouses for storage are discussed in the passage?()

A、3

B、4

C、6

D、7

4.Where might one find meat and milk?()

A、Grain elevator

B、Cold-storage warehouse

C、Private warehouse

D、Bonded warehouse

5.What is NOT true of a distribution center?()

A、It is a relatively new type of warehouse

B、Product is replaced more quickly and costs are down

C、Some distribution centers are not built in the sane country as the factory

D、It builds up extensive inventories to minimize storage

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第5题
When prices are increasing, which inventory method will produce the highest cost of go

A.FIFO.

B.LIFO.

C.Averag

D.Cost of goods sold will not chang

E.

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第6题
When may the merry-go-round effect occur?()

A.If TINIT has a low value

B.If the hysteresis is too small

C.If the offset is non-zero

D.If PSSTEMP is set to a low value

E.If PTIMTEMP is set to a low value

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第7题
Every product on the market has a variety of costs built into it before it is ever put up
for sale to a customer. There are costs of production, transportation, storage, advertising, and more. Each of these costs must bring in some profit at each stage: truckers must profit from transporting products, or they would not be in business. Thus, costs also include several layers of profits. The selling price of a product must take all of these costs(and built-in profits) into consideration. The selling price itself consists of a markup over the total of all costs, and it is normally based on a percentage of the total cost.

The markup may be quite high 90 percent of cost or it may be low. Grocery items in a supermarket usually have a low markup, while mink coast have a very high one. High markups, however, do not in themselves guarantee big profits. Profits come from turnover. If an item has a 50 percent markup and does not sell, there is no profit. But if a cereal has an 8 percent markup and sells very well, there are reasonable profits.

While most pricing is based on cost factors, there are some exceptions. Prestige pricing means setting prices artificially high in order to attract select clientele. Such pricing attempts to suggest that the quality or style. of the product is exceptional or that the item cannot be found elsewhere. Stores can use prestige pricing to attract wealthy shoppers.

Leader pricing and bait pricing are the opposites of prestige pricing. Leader pricing means setting low prices on certain items to get people to come into the stores. The products so priced are called loss leaders because little or no profit can be made on them. The profits are made from other products people buy while in the store. Bait pricing, now generally considered illegal, means setting artificially low prices to attract customers. The store, however, has no intention of selling goods at the bait prices. The point is to get people into the store and persuade them of the inferiority of the low-priced item. Then a higher-priced item is presented as a better alternative.

A common retail tactic is odd priced products. For some products of $300, the store will set the price at $295 or $299.95 to give the appearance of a lower price. Automobiles and other high-priced products are usually priced in this manner. For some reason $7995 has more appeal to a potential car customer than $8000.

Bid pricing is a special kind of price setting. It is often used in the awarding of government contracts. Several companies are asked to submit bids on a job, and normally the lowest bidder wins. A school system may want to buy a large number of computers. Several companies are asked to submit prices, and the school district will decide on the best bid based as well on considerations of quality and service.

What is the base of selling price?

A.the cost of production

B.a percentage of total cost

C.the cost of transportation

D.the cost of storage.

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第8题
You can call the front desk directly__.

A.Note that even when

B.inelastic prices

C.big-city orientations

D.executive's needs

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第9题
When does "duration" become a less accurate predictor of expected change in
security prices?()

A、As interest rate shocks increase in size.

B、As interest rate shocks decrease in size.

C、When maturity distributions of an FI's assets and liabilities are considered.

D、As inflation decreases.

E、When the leverage adjustment is incorporated.

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第10题
According to Buys Ballot's law,when an observer in the Northern Hemisphere experiences a northwest wind,the center of low pressure is located to the ().

A.northeast

B.west-southwest

C.northwest

D.south-southeast

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第11题
Every product on the market has a variety of costs built into it before it is ever put up
for sale to a customer. There are costs of production, transportation, storage, advertising, and more. Each of these costs must bring in some profit at each stage: truckers must profit from transporting products, or they would not be in business. Thus, costs also include several layers of profits. The selling price of a product must take all of these costs(and built-in profits) into consideration. The selling price itself consists of a markup over the total of all costs, and it is normally based on a percentage of the total cost.

The markup may be quite high 90 percent of cost or it may be low. Grocery items in a supermarket usually have a low markup, while mink cost have a very high one. High markups, however, do not in themselves guarantee big profits. Profits come from turnover. If an item has a 50 percent markup and does not sell, there is no profit. But if a cereal has an 8 percent markup and sells very well, there are reasonable profits.

While most pricing is based on cost factors, there are some exceptions. Prestige pricing means setting prices artificially high in order to attract select clientele. Such pricing attempts to suggest that the quality or style. of the product is exceptional or that the item cannot be found elsewhere. Stores can use prestige pricing to attract wealthy shoppers.

Leader pricing and bait pricing are the opposites of prestige pricing. Leader pricing means setting low prices on certain items to get people to come into the stores. The products so priced are called loss leaders because little or no profit can be made on them. The profits are made from other products people buy while in the store. Bait pricing, now generally considered illegal, means setting artificially low prices to attract customers. The store, however, has no intention of selling goods at the bait prices. The point is to get people into the store and persuade them of the inferiority of the low-priced item. Then a higher priced item is presented as a better alternative.

A common retail tactic is odd priced products. For some products of $300, the store will set the price at $295 or $299.95 to give the appearance of a lower price. Automobiles and other high-priced products are usually priced in this manner. For some reason $7995 has more appear to a potential car customer than $8000.

Bid pricing is a special kind of price setting. It is often used in the awarding of government contracts. Several companies are asked to submit bids on a job, and normally the lowest bidder wins. A school system may want to buy a large number of computers. Several companies are asked to submit prices, and the school district will decide on the best bid based as well on considerations of quality and service.

We learn from the second paragraph, ______.

A.reducing cost is the surest way to increase profits

B.profits depend on how fast goods are moving

C.fair markup promise the greatest profits

D.lower markup brings reasonable profits

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