Lach question weighs equally and the total will be counted out of 100 graph rela

Question

Lach question weighs equally and the total will be counted out of 100 graph relates to the next 4 questions It shows four possible changes (S,S,. D, D) to the market equilibrium given by D and S. S2 D2 Di 13) [SD,p] which line shows the effect of an increase in the number of sellers in the market? c) D d) D b) S d) D L) [SD,p] On the above graph, which line shows the effect of an increase in the price ofa complerment? 15) [SD,pl On the above graph, which line shows the effect of a decrease in the price of an imput in a S b) S c) D d) D e) There is not enough information to answer this question. SD.p] Which line in the graph above shows the effect of a decrease in the price of a substitute good? b) S c) D e) There is not enough information to answer this question

Explanation / Answer

13) Increase in the number of sellers would shift the supply curve to the right : S2

14) Increase in price of a complement would decrease the demand (shift demand curve to the left, negative cross price elasticity) : D1

15) Decrease in the price of an input in production would shift the supply curve to the right : S2 (production becomes cheaper)

16) Decrease in the price of a substitute good would decrease the demand (shift the demand curve to the left, positive cross price elasticity) : D1

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