1. Everybody loves chocolate…at least I have not met anybody who doesn’t like it.

Consider the market for chocolate. The price of Milky Way brand goes up by 40
cents while the price of Snickers brand remains constant. Illustrate by Supply and
Demand Diagram how it will affect market for Snickers.
Answer: D for Snickers goes up; P up Q up
2. Consider market for DVDs. Illustrate by Supply and Demand Diagram how will
decrease in price for a DVD player affect market for DVDs.
Answer: D for DVDs goes up; P up Q up
3. Consider market for cars. Let’s look at AUDI and NISSAN. AUDI cars become
more expensive as a result of tariff imposed on German cars as a result of
disagreement between EU and USA auto dealers. Illustrate by Supply and
Demand Diagram how it will affect market for NISSAN cars?
Answer: D for Nissan cars goes up; P up Q up
4. Consider a significant increase in car insurance rates. Illustrate by Supply and
Demand Diagram how it will affect market for new cars?
Answer: D for cars goes down; P down, Q down
5. You are thinking what to do on Saturday night…you were thinking about going to
Mercy Lounge. Given that U2 is giving a concert at Gaylord Entertainment
Center illustrate by Supply and Demand Diagram how it will affect Saturday
night at Mercy Lounge. Let’s assume most of you love U2.
Answer: D goes down at Mercy Lounge; P down Q down
6. You own banana plantations. Severe hurricane destroyed most of banana
plantations. Illustrate by Supply and Demand Diagram how it will affect market
for bananas.
Answer: S goes down; P up Q down
7. You have a choice of purchasing a hard copy book or an e-book for your
economics class. Let’s assume most of students prefer e-book illustrate by Supply
and Demand Diagram how it will affect market for hard copy economics books.
Answer: D goes down for hard copy books; P down Q down
8. You are producing elite furniture. You are mostly using oak for most of your
furniture. Illustrate by Supply and Demand Diagram how an increase in the price
of oak will affect market for the furniture you produce.
Answer: S of furniture goes down; P up Q down
9. You expect Sony to have huge sale on their flat screen and plasma TVs a day after
Thanksgiving. You want to purchase a Sony TV. Illustrate by Supply and Demand
Diagram how it will affect market for Sony TVs today.
Answer: D for SONY TVs today goes down; P down Q down
10. Farmers who grow corn were able to receive additional subsidies from US
government. Illustrate by Supply and Demand Diagram how it will affect market
for corn.
Answer: S of wheat goes up; P down Q up
11. Everybody goes crazy about new Puma shoes. Illustrate by Supply and Demand
Diagram how it will affect the market for Adidas shoes.
Answer: D for Adidas shoes goes down; P down Q down
12. Illustrate by Supply and Demand Diagram how summer season affects market for
airplane tickets?
Answer: D for airplane tickets goes up; P up Q up
13. Consider Wal-Mart brands as inferior goods. If overall wealth of the American
society increases. Illustrate by Supply and Demand Diagram how it will affect
Wal-Mart stores across US.
Answer: D goes down; P down Q down