b) In the summer, it was observed that there was a decrease in both the price of umbrellas and the quantity of umbrellas sold. Explain this observation in supply and demand terms using diagram.
Question 3
a) Using a suitable diagram to illustrate your answer, explain how the market is ‘self-correcting’ and returns to an equilibrium position if initially the market price was set below the
b) In the summer, it was observed that there was a decrease in both the price of umbrellas and the quantity of umbrellas sold. Explain this observation in
c) If the demand and supply curve for hats are given by the following equations: D = 140 – 7P S = 20 + 3P Where P is the price of hats. Showing all workings, calculate the quantity of hats bought and sold at equilibrium. d) State five factors which could cause the demand curve to shift right.
Trending now
This is a popular solution!
Step by step
Solved in 2 steps with 2 images
