Chapter 2: Some Practice Questions

Note: Please use these questions to refresh your basic understanding of the material
covered from this class. The solutions will be sent out shortly and in case of any
concerns please contact the AA of your section for help.

1. Draw the demand curve:

= 10 2
2. At what price quantity ratio is price elasticity of demand = -1.

3. Where is demand inelastic vs elastic?

4. Draw the supply curve:

= 3

5. What is price elasticity of supply when P = 2

6. Take the demand and supply curves given above and find the equilibrium price
and quantity

7. Suppose the supply curve shifts inwards and is now given by:
= 1 + 3
8. Find the new equilibrium price and quantity.

9. Draw the market equilibrium. Shift demand and supply curves both such that:
- Price increases but quantity decreases
- Price and quantity both increase