THE ASSIGNMENT MUST BE TYPED, HOWEVER THE GRAPHS CAN BE DRAWN BY HAND. GRAPHS SHOULD BE CLEAR AND CORRECTLY LABELLED. QUESTION 1 Using demand and supply graphs illustrate and explain the difference between a change in quantity demanded of hats and a change in demand for hats. In your answer explain two factors that will result in the change in demand for hats. 4 Marks QUESTION 2 Using demand and supply graphs illustrate and explain the effect of the following events on the market for solar panels (assume ceteris paribus). In your answer, include an explanation of the market adjustment process. (a) The price of solar panels is above the market equilibrium price.?(b) The price of electricity for an average household has decreased by 50 percent. (c) The number of solar panel producers have increased by 50 percent. XXXXXXXXXX = 6 Marks QUESTION 3 The demand for watermelon, which is harvested in summer, is highest during the summer months and lowest during winter months. Yet watermelon prices are normally lower in summer than in winter. Use demand and supply graphs to illustrate and explain how this is possible. Clearly indicate the equilibrium price and equilibrium quantity in your graph. 3 Marks QUESTION 4 Ceteris paribus, at the same time when the demand for yoga services has increased the government has also introduced strict regulations that has resulted in a fall in the number of yoga providers. Using demand and supply graphs illustrate and explain the impact on the equilibrium price and quantity in the market for yoga services? 4 Marks HINT: There is more than one outcome. QUESTION 5 In 2003, when music downloading first took off, Universal Music slashed the prices of a CD from an average of $21 to an average of $15. The company said that it expected the price cut to boost the quantity of CDs sold by 40 per cent, other things remaining the same. (a) What was Universal Music's estimate of the price elasticity of demand for CDs? ? (b) Given your...
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