DD & SS

Market equilibrium refers to the ______________________________.

• state of either surplus or shortage .in a market

• condition in which the quantity supplied is greater than the quantity demanded.

• condition in which the quantity demanded is greater than the quantity supplied.

• intersection (meeting) point of the supply and demand curves.

Which of the following are complement goods?

• McDonalds and Burger King

• iPhone and Samsung Galaxy

• Bread and Butter

• Coffee and Tea

Identify which of the following is correct when Government reduces subsidies for sugar.

• Demand curve shift to right

• Demand curve shift to left

• Supply curve shift to right

• Supply curve shift to left

Identify which of the following is correct when buyers expect higher future price in the sugar market.

• Demand curve shifts to right

• Demand curve shifts to left

• Supply curve shifts to right

• Supply curve shifts to left

Using DD & SS curves, explain the effects on the equilibrium P&Q in sugar market when incomes of consumers rise and sugar is an inferior good.

• Demand curve shifts to right; equilibrium price increases and equilibrium quantity increases.

• Demand curve shifts to left; equilibrium price decreases and equilibrium price decreases.

• Supply curve shifts to right; equilibrium price decreases and equilibrium quantity increases.

• Supply curve shifts to left; equilibrium price increases and equilibrium quantity decreases.

Discuss the impact of a technological advancement in the production of smartphones on the equilibrium price and quantity in the market.

• Demand for smartphones increases, leading to a higher equilibrium price.

• Supply of smartphones increases, leading to a lower equilibrium price.

• Demand for smartphones decreases, leading to a lower equilibrium quantity.

• Supply of smartphones decreases, leading to a higher equilibrium quantity.

7. When the increase in the price of one good causes the demand for another good to increase, the goods are

• normal

• substitutes

• inferior

• complement

According to the law of demand, there is a negative relationship between price the quantity of a good supplied.

• TRUE

• FALSE