***20點***F.4 ECON change in demand and supply問題`急!!!!!!*****

1 (a) The oobservatory forecasts that the monsoon will cause a sharp drop in temperature at the week end. It will cause an increase in demand. The demand curve shifts to the right , the price goes up and the quantity demanded also increases.

1(b) Down jacket stores hold clearance sales on New Year’s Eve. It has no effect on the demand curve. It is only a movement along the demand curve. According to the law of demand, when prices goes down, quantity demanded goes up.

2(a) Effective advertisements shift the demand curve for candy to the right. In crease in demand leads to an increase in price and thus quantity demanded.
As there is an increase in both the price and the quantity demanded, the total revenue is therefore increased.

2(b) There is a change in the population size.
The candy price is expected to go up or down in the near future.
There is a medicial report saying that eating candy is good or bad for
health.

1(a) As there will be a sharp drop in temperature, the demand for jackets would increase. This will cause the demand curve shifting to the right. The supply will not change. The equilibrium price drops and the equilibrium quantity rises.

(b) The price of the jackets drops. According to the law of demand, the quantity demanded of the jackets rises as its price rise, holding other factors constant.

2(a) As there is advertisements on the tv or newspapers, the demand for the candy increases. The supply of the candy does not change. As a result, both the equilibrium price and quantity increase. Thus, the revenue of the producer increases.

(b) Income of consumer and size of market

1a) Demand for down jackets will increase (Demand curve shifts to the right) and thus drive up the price. Qd will increase.

1b) Down jacket stores hold clearance sales. This mean, at a given quantity, the price of down jacket decreases. So, the supply curve shifts to the right. The price of down jacket decreases and Qd increases. (this situation does not affect demand curve. It is because any factors other than price would change the demand. but clearance sales is a way using lower price to attract customers. so, it has nothing to do with shifting demand.)

2a) Sorry that I cannot draw a diagram here. But at this situation, demand for candies will increase and thus shifting the demand curve to the right, increasing both price and Qd and thus total revenue.

2b) Any factors other than price will affect demand. For example, income level, preference, taste, changing prices of subsitute or complement...