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    Mechanics of Supply and Demand

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    Tom Schenk Jr.
    This document outlines an economics homework assignment on the mechanics of supply and demand. It includes 7 questions about supply and demand curves and equilibrium prices and quantities for various markets like oil, gasoline, and football tickets. Students are asked to draw supply and demand curves, identify equilibrium points, and determine how prices and quantities would change given shifts in supply or demand.

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    Attribution Non-Commercial (BY-NC)
    Download as PDF, TXT or read online from Scribd

    Mechanics of Supply and Demand

    Uploaded by

    Tom Schenk Jr.
    845 views2 pages
    This document outlines an economics homework assignment on the mechanics of supply and demand. It includes 7 questions about supply and demand curves and equilibrium prices and quantities for various markets like oil, gasoline, and football tickets. Students are asked to draw supply and demand curves, identify equilibrium points, and determine how prices and quantities would change given shifts in supply or demand.

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    © Attribution Non-Commercial (BY-NC)

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    This document outlines an economics homework assignment on the mechanics of supply and demand. It includes 7 questions about supply and demand curves and equilibrium prices and quantities for various markets like oil, gasoline, and football tickets. Students are asked to draw supply and demand curves, identify equilibrium points, and determine how prices and quantities would change given shifts in supply or demand.

    Copyright:

    Attribution Non-Commercial (BY-NC)
    Download as PDF, TXT or read online from Scribd
    Download as pdf or txt
    845 views2 pages

    Mechanics of Supply and Demand

    Uploaded by

    Tom Schenk Jr.
    This document outlines an economics homework assignment on the mechanics of supply and demand. It includes 7 questions about supply and demand curves and equilibrium prices and quantities for various markets like oil, gasoline, and football tickets. Students are asked to draw supply and demand curves, identify equilibrium points, and determine how prices and quantities would change given shifts in supply or demand.

    Copyright:

    Attribution Non-Commercial (BY-NC)
    Download as PDF, TXT or read online from Scribd
    Download as pdf or txt
    of 2

    Homework 2:

    Mechanics of Supply & Demand


    ECON 102 – Macroeconomics
    Professor Schenk
    Due: November 3, 2009
    October 27, 2009

    1. Consider the following market supply and demand schedule:

    Quantity Quantity
    Price Demanded Supplied
    10 75 20
    20 50 50
    30 25 80
    40 0 110

    (a) Draw the supply and demand curves with the 𝑦-axis labelled “price” and 𝑥-axis labelled “quan-
    tity.”
    (b) What is the approximate equilibrium price?
    (c) Approximately how many unites will be sold at the equibilibrium price?

    2. Using your answer from above, plot the following demand curve on the same graph from question
    1.

    Quantity
    Price Supplied
    10 50
    20 80
    30 110
    40 155

    (a) What is the approximate new equilibrium price and quantity?


    (b) Did the supply curve shift to the left or the right?
    (c) What was the change in quantity demanded? What was the change in demand?
    (d) Did price increase or decrease?

    3. At an Iowa State football game, 40,000 tickets were sold at $30 a piece. The game was sold out and
    some people did not get tickets even though those individual were willing to pay at least $30. This
    suggests the selling price:

    1
    (a) was at equilibrium.
    (b) was below equilibrium
    (c) was above equilibrium
    (d) could not have been any higher

    4. In 1990 the United Nations (UN) placed trade sanctions on Iraqi oil. In 1996, Iraq was allowed limited
    exports of oil to make war reparations. What was the effect of the two events on equilibrium price and
    quantity of oil?
    (a) Price fell initially, then rose; quantity fell and then rose.
    (b) Price fell initially, then rose; quantity rose and then fell.
    (c) Price rose initially, then fell; quantity fell and then rose.
    (d) Price rose initially, then fell; quantity rose and then fell.
    5. When the UN allowed Iraq to export some oil, was there a change in demand or quantity demanded?
    Was there a change in supply or quantity supplied?

    6. To keep the price of gas from rising quickly after Katrina, the government instituted price ceilings on
    the price of gasoline in some states. These ceilings caused what in the gasoline market?

    (a) surpluses
    (b) a movement of the demand curve
    (c) a movement along the demand curve
    (d) shortages

    7. Presume the market demand curve can be written:


    𝑝
    𝑄𝑑 = 31 − (1)
    2
    where 𝑄𝑑 is the amount demanded at price 𝑝. Also, let the supply curve be:

    𝑄𝑠 − 3 + 8𝑝 (2)

    where 𝑄𝑠 is the amount suppplied at price 𝑝.

    (a) Draw the demand curve for prices between $0 and $10.
    (b) Draw the supply curve for prices between $0 and $10.
    (c) What is the price where there will be no left over goods in the market?
    (d) How many goods will be sold at that price?

    You’re Done!

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