1.Explain whether thestatement is True, False or Uncertain. Includediagrams where appropriate.

When market demand and supply shift in opposite directions, we can certainlysay how the equilibrium price and quantity change.

2. Explain whether thestatement is True, False or Uncertain. Includediagrams where appropriate.

Innovations in the production of batteries leads to a rightward shift in the market supply for hybrid cars, while demand stays the same. This leads to a decrease in the equilibrium price and an increase in equilibrium quantity.

3. Explain whether thestatement is True, False or Uncertain. Includediagrams where appropriate.

If a consumer finds two goods perfectly substitutable their cross price elasticity of demand will be negative.

4. Explain whether thestatement is True, False or Uncertain. Includediagrams where appropriate.

If the demand is perfectly elastic, then a shift in the supply curve does not affect the equilibrium price.