Assessment 4
Started on Saturday, 15 June 2024,
State Finished
Completed on Saturday, 15 June 2024,
Time taken
Marks 16.00/16.00
Grade 100.00 out of 100.00
Question 1
I confirm
that this assessment will be my own individual work;
that I will not communicate with anyone else in any way during the completion of this
assessment;
that I will not cheat in any way in completing and submitting this assessment.
I confirm.
I do not confirm.
Question 2
If the price of running shoes is above the equilibrium price, there will be an excess
supply of running shoes.
Note, that you will lose 50% of the mark for this question if you choose the incorrect
option.
If you are not sure about the answer and do not want to guess, choose the “Unsure”
option. You will neither receive marks for the question nor will you lose marks for
choosing this option.
Feedback
The statement is true. At any price above the equilibrium price, there is an
excess supply of running shoes, leading to a surplus. Market forces then drive the
price downward to eliminate the surplus and restore equilibrium.
Adjustment process:
To eliminate the surplus, market forces drive the price downward:
• Producers lower prices: To sell the excess stock of
running shoes, producers reduce prices.
• Quantity demanded increases: As prices fall, more
consumers are willing and able to buy running shoes,
increasing the quantity demanded.
• Quantity supplied decreases: As prices fall, producers
are less willing to supply as many running shoes,
decreasing the quantity supplied.
These adjustments continue until the price returns to the equilibrium level, where the
quantity supplied equals the quantity demanded, and the surplus is eliminated.
Question 3
A market can only be in equilibrium if there is no tendency for things to change.
Note, that you will lose 50% of the mark for this question if you choose the incorrect
option.
2
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