Shaheed Zulfikar Ali Bhutto Institute of Science & Technology

Micro – Economics
Assignment # 03

Name: Abdulrehman Abbasi

Reg No: 2017140

Q1. What is a Competitive market? Briefly describe a type of market that is not
perfectly competitive.
Answer: A Competitive market is a market in which there are many buyers and sellers of an
identical product so that each has a negligible impact on the market. Other types of markets
include monopoly, in which there is only one seller, oligopoly, there are a few sellers that do
not always compete aggressively, and monopolistically competitive markets, in which there
are many sellers, each one of them offering a slightly different product.

Q2. What are the demand schedule and the demand curve, and how are they related?
Why does the demand curve slope downward?
Answer: The demand schedule is stable showing the relationship between the price of a food
or service and the quantity demanded at that price. The demand curve is the downward

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 Shaheed Zulfikar Ali Bhutto Institute of Science & Technology
sloping line relating price and quantity demanded. It is the representation of this table in a
graph.

Q3. Does a change in………… Explain your answer?

Answer: A change in consumer taste will result in the demand curve shifting , this is because
a change in taste represents a change in amount demanded that is not caused by a change the
price of a good. A change in price leads to a movement along the demand curve.

Q4. Harry’s income declines……..pumpkin juice?

Answer: Since Harry purchases more pumpkin juice as his income declines it is an inferior
good. This represents a shift in his demand curve to the right because his demand increased
without a change to price.

Q5. What are the supply……… slope upward?

Answer: A supply schedule shows how much of a product is supplied at a given price. The
supply curve is a graph representing the supply schedule. The supply curve and supply
schedule are related because the supply curve is simply a graph showing the points in the
supply schedule.

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