MZUMBE UNIVERSITY
DEPARTMENT OF ECONOMICS
TUTORIAL QUESTIONS (ECO 111)
SEMESTER 2: 2024-2025
THEORY OF DEMAND, SUPPLY, MARKET EQUILLIBRIUM
1. Define the following: i) Demand ii) Supply.
2. State the i) Law of Demand ii) Law of supply. Explain types of Inter related Demand
and supply.
3. What is the difference between market i) Demand Curve and Table ii) Supply Curve
and Table.
4. What is the difference between individual i) Demand Curve and Table ii) Supply Curve
and Table.
5. Explain features of demand curve and supply curve.
6. What are the reasons for i) abnormal demand curve and ii) exceptional supply curve.
7. By using the following information; P=5, Qd = 5; P=6, Qd=4; P=7, Qd=3; P=8, Qd=2;
P=9,Qd=1 (P=Price, Qd =Quantity demanded).Draw a demand table and curve.
8. By using the following information; P=1, Qs = 11; P=2, Qs=13, ;P=5,Qs=15;
P=7,Qs=17; P=9,Qs=19 (P=Price, Qs=Quantity supplied).Draw a supply schedule and
curve.
9. What is demand function and supply function. Write demand and supply equation.
10. With a help of a diagram explain the difference between i) change in quantity demanded
and change in demand ii) shift of the demand curve and movement along the demand
curve iii) Normal goods and Inferior goods.
11. With a help of a diagram, explain determinants of / factors influencing i) Demand ii)
Supply.
12. Define Market Equilibrium. Differentiate between a) Price Floor and Price Ceiling b)
Shortage and Surplus c) Excess supply and Excess demand d) Equilibrium price and
Equilibrium quantity. Support with a diagram.
13. Qd=20-2p and Qs=10+8p . Calculate i) Equilibrium Price ii) Equilibrium Quantity.
14. The market for pizza has the following demand and supply schedules:
Price (x) Quantity Demanded (x) Quantity Supplied (x)
4 100 20
5 90 30
6 80 40
7 70 70
8 60 110
9 50 120
a) Draw a market equilibrium curve
b) What is the equilibrium price and quantity in this market?
MZUMBE UNIVERSITY-DEPARTMENT OF ECONOMICS; TUTORIAL QUESTIONS; SEMESTER 2-ECO 111-
2024/25
15. With a help of a diagram explain how a i) change in demand ii) change in supply
affects Equilibrium price and quantity.
16. By using information from the tables below, answer the following questions:
i) What is excess supply/demand at price $ 10? Price $ 40?
ii) Label equilibrium price and quantity
Demand Supply
Price ($) D1 D2 D3 Price($) S1 S2 S3
10 30 5 15 10 0 5 15
20 17 6 7 20 0 9 18
30 13 0 9 30 20 14 16
40 6 0 6 40 20 19 22
17. Explain Types of Price elasticity of i) Demand. ii) Supply.
18. Explain Determinants of Price elasticity of i) Demand ii) Supply.
19. Explain application of price elasticity of demand and supply in an economy.
20. By using information from the following table, calculate
i) Price elasticity of supply using a point method
ii) Price elasticity of demand using both a Point method and an Arc Method.
iii) Interpret your answers
Price (x) Quantity Demanded (x) Quantity Supplied (x)
3 100 20
4 80 50
21. What is the difference between Cross elasticity of demand and Income elasticity of
demand. Explain types of Cross elasticity of demand.
22. Calculate Cross Elasticity of Demand and interpret your answer.
Price (X) Quantity Demanded (Y)
5 70
6 60
23. By using the following information calculate Income Elasticity of Demand when
Income 100 and 200.
Income Quantity Demanded (x)
100 50
200 100
MZUMBE UNIVERSITY-DEPARTMENT OF ECONOMICS; TUTORIAL QUESTIONS; SEMESTER 2-ECO 111-
2024/25
