EXERCISE NO.

1
DEMAND

1. Of the following items discussed below:

a. Determine if it is a Change in Demand or Change in Quantity Demanded
b. Determine if the price will increase or decrease
c. Determine if the quantity demanded will increase or decrease
d. Identify what factor affects the demand
e. Illustrate in graph

a) Average price of tomato in the market have plunged to all-time lows.

Price a) Change in Quantity Demanded

b) Decrease

c) Increase

d) Price of the products

Demand

b) A recent study just announced that banana can cure covid19.

Price
a) Change in Demand

b) Increase

c) Increase

d) Speculation
Demand

c) Coffee and cream are complementary goods. Typhoon Rolly adversely affects the
coffee bean crop leading to an increase in the price of coffee. Show how it would
affect the demand for cream.
Price
a) Change in Quantity Demand

b) Decrease

c) Decrease

d) Price of Related Goods

Demand
 d) Suppose the per capita income in the Philippines increases and at the same time a
multi-featured phone has become a fad. How would these affect the demand for that
particular gadget?
Price
a) Change in Demand

b) Decrease

c) Increase

d) Income of the Consumers

Demand

e) The price of margarine has increased, show the effect it would have on demand for
butter.
Price
a) Change in Quantity Demand

b) Decrease

c) Increase

d) Price of Related Goods

Demand
2. Using the hypothetical price-quantity demand relationship for coffee solve for the market
demand curve (assumption: there are only three consumers in the market).

QUANTITY PURCHASED (CUPS) MARKET

PRICE (Php)
Ana Julia Fe DEMAND
2.00 20 25 13 58
4.00 15 18 10 43
6.00 10 15 5 30
8.00 6 7 3 16
10.00 2 4 1 7
12.00 1 2 0 3

3. A. Plot the individual demand and the market demand curve.

a. Ana

12.0
0
P
10.0
R 0
I 8.00
C 6.00
E 4.00
 2.00
0 2 4 6 8 10 12 14 16 1 20
8
QUANTITY
b. Julia
12.00
10.00
P 8.00
R 6.00
I 4.00
C 2.00
E 0 2 4 6 8 1 12 14 1 18 20 2 24 2
0 6 2 6

QUANTITY
c. Fe
12.0
0
P 10.0
R 0
I 8.00
C 6.00
E 4.00
2.00
0 2 4 6 8 10 12 1
4

d. Market Demand QUANTITY

12.00
10.00
P 8.00
R 6.00
I 4.00
C
2.00
E
0 5 10 15 2 25 30 3 40 45 50 5 60
0 5 5

QUANTITY

3. If the current price of good A is P10.00, the intercept of demand curve is 12 while the slope
is 0.75 Determine how much of a good A will be demanded by consumer.
Qd=a-bP
Qd=a-bP
 Qd=12-0.75P
=12-0.75(10)
=12-7.5
ANSWER: Qd=7.5