Supply and Demand
1. Supply-demand theoretical questions:
• What is a demand schedule? What is the quantity demanded?
• What is a shift in the demand ?
• Again, shift in demand: What happens when the price of a substitute good increases?
• How does the market demand curve differ from an individual demand curve?
2. Explain how the following factors will shift the demand curve for Boeing
airplanes.
a. The price of Airbus airplanes increases.
b. There is a surge in the demand of airplane tickets as a consequence of the recovery.
c. Oil prices increase.
3. Explain how the following factors will shift the supply curve for microchips:
a. A new AI software substantially improves the productivity of microchip production.
b. Bottlenecks in the supply of silicon .
c. Increase in the wage of engineers required in the production process.
4. Explain with a supply and demand model the expected effect on US long- term interest rates of Quantitative Tightening.
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