Introduction to Microeconomics Review Questions: Chapters 3and 4 1. PRICE PER UNIT QUANTITY OF X QUANTITY OF X OF X DEMANDED PER TIME SUPPLIED PER TIME UNIT UNIT $20 O 1,500 $18 200 1,200 $16 400 900 $14 600 600 $12 800 300 $10 1,000 0 A. Graph the above supply and demand schedule. Label all axes and curves. Indicate equilibrium price and quantity according to the above market data for good X. B. Explain what is meant by the term equilibrium. C. At a price of $18.00 per unit, other things held constant, what exists in this market? Indicate this on your graph. D. At a price of $12.00 per unit, other things held constant, what exists in this market? Indicate this on your graph. E. What will happen over time starting a t a price of $18.00 or a price of $12.00 if the market is allowed to operate on its own? Explain carefully the process by which a market moves toward equilibrium accounting for the role of inventories in the market adjustment