Assignment
Chapter 3 Demand & Supply Theory. Macroeconomics.
Question #1: Using demand and supply curves, diagrammatically demonstrate what happens to the equilibrium price and quantity when:
A. An increase in demand that is greater than the increase in supply?
B. Demand falls and supply is constant
Question #2: Use a demand/supply curve or both to graphically demonstrate the following:
A. The demand for automobiles when the price of gasoline rises sharply and stays high.
B. The supply of computers if a tax is placed on the production of computers.
Question #3: Without drawing a graph, identify whether the demand curve will shift rightward or leftward:
A. A decrease in the number of buyers
B. A rise in the price of substitutes
Question #4: Using an appropriate demand or supply curve, demonstrate and explain the economics (if any) in the following observation:
"When fines for driving over the speed limit were $100, the Chula Vista, CA Police department issued on average about 500 speeding tickets. However, when the city council raised the fine for speeding to $250 only 215 tickets were issued."