1. (10 Points) Is there a difference between the change in demand for a good or service and the change in the demanded quantity of that good? Explain. Changes in which factor(s) will cause changes in demand, and which change(s) in factor(s) will cause changes in quantity demanded? 2. Suppose that in an economy only weapons (tanks) and food (butter) are produced. a) Draw the Production Possibilities Curve (PPI) for the country (economy) and indicate why it most likely has a concave shape to the origin. b) Explain the concepts of efficiency and unemployment on the figure. c) If there are only two political parties in the country and they are called "Hawks" and "Doves" due to their stance on foreign policy, show us the production points that these two political parties will choose as A and B on the PPI you have drawn. d) Now suppose that a neighboring country that is considered an aggressor has halved (reduced) its military presence. Depending on this development, both parties decided to reduce their desired weapon production to the same extent. Which party gets the higher "peace bonus" in terms of increased butter production? e) Assume that there is a technological advance that affects the production of both goods at the same rate. How does this development affect UIE? Explain with the help of the concept of growth. 3. Suppose you are analyzing the automobile market. Using graphs, explain how the following developments will affect the equilibrium price and equilibrium quantity in the automobile market and why. To answer each question, state in order which factor is affected, how this will affect the supply and/or demand curves, and what the new equilibrium price and quantity will be as a result. a) If gasoline and diesel prices increase, b) If there is an increase in steel prices, c) If public transportation services become cheaper and better quality, d) In general, if there is a large decrease in the premiums of all kinds of (compulsory and noncompulsory) automobile insurance (Casco, etc.) and automobile repair fees