ECS2601 - ASSESSMENT 2 - EXPECTED QUESTIONS AND ANSWERS - 2024

ECS2601 – ASSESSMENT 2 – EXPEXTED QUESTIONS AND ANSWERS - 2024



Assessment 2
Started on Thursday, 14 September 2023,
State Finished
Completed on Thursday, 14 September 2023,
Time taken
Marks 15.00/20.00
Grade 75.00 out of 100.00


Question 1
The substitution effect of a price decrease for a good with a normal
indifference curve pattern …

a.
is always inversely related to the price change.

b.
is measured by the horizontal distance between the original and the new indifference
curves.

c.
is sufficient information to plot an ordinary demand curve for the commodity being
considered.

d.
measures the change in consumption of the good that is due to the consumer’s
feeling of being richer.



Question 2
Imagine that there are only three consumers in a particular market for apples:
Andrew, John and Michael. We are interested in the demand for apples. The
demand equations for the three consumers are as follows:

Andrew: Qd = 10 - 2P

John: Qd= 8 - P

Michael: Qd = 14 - 2P

1

, ECS2601 – ASSESSMENT 2 – EXPEXTED QUESTIONS AND ANSWERS - 2024


If the price of apples is R3/kg, how much would the demand for the market as a
whole be?



a.
32

b.
17

c.
27

d.
22



Question 3




The magnitude of the subsitution effect and income effect in this graph
reperesnts ...

a.

2