Q2. Data response Questions:

The demand and supply schedules of good X are given below in the table below.

(20 Marks)

Px ($)

Quantity demanded

Quantity supplied

1

120

0

2

100

20

3

80

40

4

60

60

5

40

80

6

20

100

A) Define what is meant by the quantity demanded and the quantity supplied

B) What is the equilibrium price and quantity?

C) What would be the excess demand or supply if the price were:

i. $2

ii. $6

D) If there was an increase in income and the product was an inferior good what would be the equilibrium price and quantity if 20 units less were demanded at each price?