Practise demand-and-supply questions by drawing shifts, calculating shortages or surpluses and applying market data to equilibrium changes.
What is meant by the term demand?
Using the diagram below, draw the effects on the market for crops after a hurricane destroys farm land. Label the new curve, new equilibrium price and new equilibrium quantity.
Figure 2
Figure 1 below shows a change in demand for tickets to a sporting event.
Figure 1
Which one of the following statements is true?
When the price falls, the quantity demanded falls
The demand curve slopes upwards from left to right
An increase in demand is shown by a shift to the right
A decrease in demand is shown by a shift to the right
Define the term excess supply.
Figure 2 shows the market for electric cars.
Using the diagram below, draw the likely effects on the market for electric cars following the introduction of a subsidy on electric cars. Label the new curve, the new equilibrium price and the new equilibrium quantity.
Figure 2
State one factor that will cause a demand curve to shift to the left.
Beating the congestion in Dhaka
Nearly 17 million people live in Dhaka, the capital of Bangladesh. The majority of people live in the city centre and traffic congestion is a problem. However, there are many auto rickshaws (a small, three-wheeled vehicle, driven by a motorcycle engine) competing in the city centre to take passengers to their destinations. Fares tend to be cheaper in the city centre than they are outside the city centre and are usually agreed between passengers and drivers.
Dhaka has a large number of auto rickshaws competing for fares.
With reference to the information given in 'Beating the congestion in Dhaka', explain one reason why prices for journeys using an auto rickshaw might be higher outside the city centre.
A lack of space in many busy cities means parking is an increasing problem. Japan has developed the first Automated Parking Systems (APS). These are car parks where the cars are automatically stacked. The driver takes the car to the entrance, then technology takes over, placing each car on racks, one above the other. This allows many cars to be parked in a very small area. Not only do they offer a more practical use of space than traditional multi-storey car parks, but they cost less to build. The drivers benefit from cheaper parking fees and they save time.
Figure 4
With reference to the data above and your knowledge of economics, assess the extent to which changes in technology may reduce the shortage of car parking spaces in city centres.
What is meant by the term demand?
Figure 1 below shows a change in demand for tickets to a sporting event.
Figure 1
Which one of the following statements is true?
When the price falls, the quantity demanded falls
The demand curve slopes upwards from left to right
An increase in demand is shown by a shift to the right
A decrease in demand is shown by a shift to the right
State one factor that will cause a demand curve to shift to the left.
Beating the congestion in Dhaka
Nearly 17 million people live in Dhaka, the capital of Bangladesh. The majority of people live in the city centre and traffic congestion is a problem. However, there are many auto rickshaws (a small, three-wheeled vehicle, driven by a motorcycle engine) competing in the city centre to take passengers to their destinations. Fares tend to be cheaper in the city centre than they are outside the city centre and are usually agreed between passengers and drivers.
Dhaka has a large number of auto rickshaws competing for fares.
What is meant by the term supply?
Explain one effect on the supply curve of wheat following a change in the price of wheat.
In England, there has been an increase in the number of science, maths and modern language graduates. Some of these graduates choose to enter the teaching profession with these qualifications. Many are encouraged to do so by a government bonus payment of £ 9000, only available to graduates in these subjects. However, many do not stay in the profession for more than one or two years. This is due to problems of long working hours, bureaucracy and student behaviour. Those with science qualifications often find different types of employment quite easily.
(Source adapted from: https://www.theguardian.com/education/2019/oct/05/science-and-
language-teachers-to-get-9000-staying-on-bonus)
The price of olive oil peaked in the summer of 2024, averaging € 10000 per tonne. It is expected to fall to between €4000 and €5000 per tonne in 2025.
Some of the main areas where olive oil is produced are located in Greece, Spain and Tunisia. All are set for improved harvests of olives, after years of heatwaves and droughts causing a fall in the harvest. Better weather means Greece is expected to produce 230,000 tonnes in the 2025 season, up from 130,000 tonnes the previous year. While Spain and Tunisia are also forecasting large increases in production.
With reference to the data above and your knowledge of economics, analyse how natural factors, such as favourable weather conditions, may affect the market for olive oil in 2025.
With reference to the information given in 'Beating the congestion in Dhaka', explain one reason why prices for journeys using an auto rickshaw might be higher outside the city centre.
Using the diagram below, draw the likely effects on the market for cars of the introduction of more effective technology in production. Label the new curve, the new equilibrium price and the new equilibrium quantity.
Figure 1
Define the term excess supply.
With reference to the data above and your knowledge of economics, analyse how market forces can remove excess supply.
Public universities in Norway do not charge students any tuition fees. Education is funded by the government. In recent years Norway has spent more on education than any other country as a percentage of GDP. Norway also has one of the lowest rates of unemployment in the world.