_{For a given quantity, the demand curve For a given quantity, the supply curve}

_{shows the maximum price buyers are shows the minimum price that sellers are}

_{willing and able to pay for that quantity. willing to accept for that quantity.}

_{For a given price, the demand curveFor a given price, the supply curve}

_{shows the quantity buyers are willing shows the quantity sellers are willing}

_{and able to buy at that price.and able to sell at that price.}

_{Visual representation Visual representation}

Factors that change the location of a demand curve are called determinants of demand

(see page 2 left hand side)

Indicate the effect of the following changes in economic circumstance on the demand for X, cet par

1.________Increase in income, assume product X is a normal good

2.________Decrease in income, assume product X is an inferior good

3.________ Increase in the price of Y, products X and Y are substitutes P_Y D_X

4.________Decrease in the price of Z, products X and Z are complementsP_Z D_X

5.________Buyers expect the price of X to rise in the near future

6.no effectDecrease in the price of X

7.Visual representation

Draw an increase in demand

(question 1-5)

8 Visual representation

draw a decrease in the price of X. this causes an increase in the quantity demanded of X. moving along a given demand curve (question 6)

Factors that change in the location of a supply curve are called determinants of supply

(see page 2 right hand side)

Indicate the effect of the following changes in economic circumstance on the supply of X, cet par

1.________Decrease in the wage rate paid to workers producing product X

2.________Technological advance increases labor productivity

3.________Increase in the number of firms producing product X

4.no effectIncrease in the number of people buying product X

5.no effectIncrease in the price of X

6.Visual representation

Draw an increase in supply

(questions B1 through B3)

Visual representation

Draw an increase in the price of X. This

causes an increase in the quantity

suppiled of X. Moving along a given

supply curve (question B5)