Practice Quiz
Practice Quiz on Graphing
Answer Key
1) Using the data in the table below, what is the equilibrium quantity and equilibrium price for a cellular telephone?
Draw a graph to show equilibrium price and output.
ANSWER: Supply and demand intersection is where equilibrium price = 50 and equilibrium quantity = 60
2) The graph below illustrates the market for computers. If the number of computer buyers increases and technology advances, how will equilibrium price and output in the market for computers be affected?
Assume the changes in technology and number of buyers are equal in magnitude (in terms of how much they shift the supply or demand curve). Show the effect of these changes on the graph.
ANSWER: Shift to the right in both supply and demand. Equilibrium output increases and the equilibrium price depends on the magnitude of the shifts in demand and supply. In this case, the equilibrium price stays the same
3) The graph below illustrates the market for bottled water. If the producers of bottled water switch to using improved technology, show the effect of these changes on the graph. What will happen to the equilibrium price and output in the market for computers after the change?
ANSWER: Shift to the right in supply only. Equilibrium output increases and the equilibrium price decreases.
4) Graphically show the effect of an increase in the cost of the tomato sauce on the equilibrium price and output in the market for pizza?
ANSWER: Shift to the left in supply only. Equilibrium output decreases and the equilibrium price increases.
Answer Key
1) Using the data in the table below, what is the equilibrium quantity and equilibrium price for a cellular telephone?
Draw a graph to show equilibrium price and output.
ANSWER: Supply and demand intersection is where equilibrium price = 50 and equilibrium quantity = 60
2) The graph below illustrates the market for computers. If the number of computer buyers increases and technology advances, how will equilibrium price and output in the market for computers be affected?
Assume the changes in technology and number of buyers are equal in magnitude (in terms of how much they shift the supply or demand curve). Show the effect of these changes on the graph.
ANSWER: Shift to the right in both supply and demand. Equilibrium output increases and the equilibrium price depends on the magnitude of the shifts in demand and supply. In this case, the equilibrium price stays the same
3) The graph below illustrates the market for bottled water. If the producers of bottled water switch to using improved technology, show the effect of these changes on the graph. What will happen to the equilibrium price and output in the market for computers after the change?
ANSWER: Shift to the right in supply only. Equilibrium output increases and the equilibrium price decreases.
4) Graphically show the effect of an increase in the cost of the tomato sauce on the equilibrium price and output in the market for pizza?
ANSWER: Shift to the left in supply only. Equilibrium output decreases and the equilibrium price increases.