STEVE MENDOZA BSENTREP 1-A

Exercises/Drill
1. Graph and solve.
a. graph the following Demand and Supply Schedule in the same axis. (5 points)
Price of ice cream per Quantity Demanded Quantity Supplied
scoop
30 3 68
25 15 55
20 20 20
15 48 15
10 73 10
5 105 7
 2. Solve for Equilibrium PE and QE

Solving… #1
. QD = 2333-105P
QS=20,395P

QD = QS
2,333-105P = 20,395P
2,333=20,395+105(P)
[2,333=20,500P]
20,500
0.11380487804878048780487804878049 =P

QD = 2,333-105P
= 2,333-105(0.11380487804878048780487804878049)
=2,321.05

QS=20,395P
=20,395(0.11380487804878048780487804878049)
=2,321.05

Solving…#2
QD = 2982-677P
QS=659 +3215P
QD = QS
2,982-677P=659 +3,215P
2,982-659=3,215+677(P)
[2,323= 3,892P]
3,892
0.59686536485097636176772867420349 =P

QD = 2982-677P
=2,982-677(0.59686536485097636176772867420349)
=2,577.92

QS=659 +3215P
=659+3215(0.59686536485097636176772867420349)
=659+1,918.92
=2,577.92
 Solving…#3
QD = 169,712-22,893P
QS=599 +2515P
QD = QS
169,712-22,893P=599+ 2,515P
169,712-599=2,515+22,893(P)
[169,113=25,408P]
25,408
6.6558957808564231738035264483627 =P

QD = 169,712-22,893P
=169,712-22,893(6.6558957808564231738035264483627)
=169,712-152,373.42
=17, 338.58

QS=599 +2515P
=599 +2515(6.6558957808564231738035264483627)
=17, 338.58

Evaluation
Part I. Matching Type: Match the items in Column A with the descriptions in Column B by writing the
letter on the answer sheet provided below.
A
1. Profit a. He demands for goods and services
2. Market b. higher demand, less supply
3. Equilibrium c. the main goal of firms
4. Shortage d. A state of balance
5. Satisfaction e. The place where buyers and sellers’ trade
6. Increase in demand f. when supply curve shifts to the left
7. Increase in supply g. when demand curve to the right
8. a fall in demand h. when supply shifts to the right
9. decrease in supply i. when demand curve shifts to the left
10. if there is surplus? J. price ceiling
11.consumer k. forces that affect the slope of demand
12. changing income l. floor price
13. technological change m. forces that affect the slope of supply
14. changes in expectation n. the main goal of consumers
15. population change
16 weather condition
17. if there is shortage
18. taste of preferences
19. factors of production
20. substitute goods

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 1 17 18 19 20
6
C E D B N I H G F H A K M K K K B K M K

Part 2. Essay questions. Answer comprehensively.

1. Describe the difference between demand and supply.

Based on my understanding, the demand refers to the desire of a buyer and

his/her ability to pay for certain commodity at a specific price. While, supply is the
total numbers or quantity of certain commodity which is made or manufactured
by the producers to meet the demand of the buyers at a certain price.
In realistic situation, it’s just like in the market, we as the consumer or users
are buying stuffs from the market that corresponds to our availability of money
and needs or wants. This is what we called demands. Although, the manufactures
or the creator of certain products are making their best to made stuffs to meet
our satisfaction with related price based on its quantity and quality.

2. In what ways do the forces of demand and supply affect the market?

The supply and demand serve as the connection between buyers and
sellers that is used as the measurement for the price in the financial market. The
forces of supply and demand cooperate to affect an equilibrium prices between
users and suppliers by the certain quantity of demand that suited to the quantity
of supply.
If there is a problem occurs either in the forces of demand nor supply there
is a huge effect in the market. The flow of the market will either decline or stop.
That is why the government is always monitoring the market situation to avoid
market trouble.

3. How does the law of demand and supply affect the market?

The law of supply and demand is an economic study that explains how
supply and demand are linked to each other and its relationship that affects the
price of goods and services in the market. In the other side, if the demands are
increasing and the supply remains the same, the higher the demand it leads to a
higher equilibrium price and vice versa.
Then if the users will ask for a huge demand, it may cause shortage and leads to
economic problem wherein the price of certain commodity will increase. In case
that there is a lot of supply, or what we always called as surplus, the price of a
commodity will decrease to dispose the goods easily to the market.
In other words, the law of demand and supply plays significant role in the
market, it measures how the demand and supply meet each other to attain the
equilibrium.

4. How does equilibrium occur in the market?

The equilibrium occurs in the market when the supply curved and demand
curved intersect from each other. This is where the quantity demand and supply
are equal. The demand of the users and the supply in the market are good
enough. There is no shortage or surplus occurs. The quantity of goods and price
are suited to the demand of the buyers. In that way, the equilibrium will arise.

5. What are the price controls of the market?

The price control of the market is government mandated legal minimum or

maximum prices that set for certain or specific good or services to avoid over
pricing and other negative effects in the market. They implemented rules to
maintain the stability of the price therefore the users can afford to buy it at
equilibrium price, the main goal of the government is to avoid troubles between
the connection of buyers and sellers in the Arena of business transaction.