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AP Macroeconomics 1.6 Market Equilibrium Disequilibrium and Changes in Equilibrium Questions

Find market equilibrium, diagnose shortages and surpluses, explain price adjustment, and trace how one or two curve shifts change price and quantity.

Syllabus
Effective Fall 2022
Course
AP Macroeconomics

Exam points

  • find the equilibrium price and quantity where quantity demanded equals quantity supplied
  • compare Qd and Qs to identify and calculate a shortage or surplus
  • explain how price adjusts after a shortage or surplus to restore equilibrium
  • use a single demand or supply shift to predict changes in equilibrium price and quantity
  • analyse simultaneous demand and supply shifts, including indeterminate price or quantity effects

Covered syllabus points

MKT-2.E—Define (using graphs as appropriate) market equilibriumMKT-2.F—a. Define a surplus and shortage. b. Explain (using graphs as appropriate) how prices adjust to restore equilibrium in markets…MKT-2.G—Explain (using graphs as appropriate) how changes in demand and supply affect equilibrium price and equilibrium quantity

Question 1

[Maximum number: 1]

The table above shows the quantity demanded and quantity supplied for bushels of wheat at various prices. Which of the following combinations is the equilibrium price and quantity for wheat?

Price

Bushels of Wheat

$2.00

10,000

$1.75

15,000

$1.50

20,000

$1.25

30,000

$0.75

5,000

ANNUAL CONSUMER PRICE INDEX (CPI)

Table for Question 1 — AP Macroeconomics

Question 2

[Maximum number: 1]

． Shirts are bought and sold in a competitive market．If there are 1,200 shirts available for sale but consumers would like to purchase 1，500 shirts at the current market price，which of the following is true？

A

（A） The current market price is higher than the equilibrium market price．

B

（B） The market is experiencing a shortage．

C

（C） The market is experiencing a surplus．

D

（D） The market is in equilibrium．

E

（E） The quantity supplied is greater than the quantity demanded．

Question 3

[Maximum number: 1]

Assume that the market for bottled water is in equilibrium. If both the supply of and the demand for bottled water decrease, what will be the effect on equilibrium price and quantity?

Price

Quantity

Decrease

Decrease

Decrease

Increase

Increase

Decrease

Increase

Indeterminate

Indeterminate

Decrease

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