Question 1 What is the law of supply? Highlight three non-price determinants of market supply. [5 marks) Question 2 Consider the perfectly competitive market for canned tomato soup in Australia using supply and demand analysis. Explain the effect of each of the following with the help of a diagram on equilibrium price and quantity: a. Drought in the tomato growing region of Australia. (1 mark) b. An increase in the price of take away food from restaurants and cafes. (1 mark) c. The classification of tomatoes as the healthiest vegetable by the Cancer Council. (1 mark) d. A reduction in minimum wage. (2 marks) Question 3 a. Suppose a boom in stock market prices increases people's wealth. Using aggregate demand and aggregate supply analysis identify the curves that are affected and the way these curves would shift. Clearly explain the new short run equilibrium. (3 marks) b. What type of government and monetary policy can restore the economy to its long run equilibrium? (2 marks)