The figure above indicates the demand and supply for Gasoline. The price is given per gallon and quantity of gasoline in millions of gallons.

1.1 What is the difference between a change in demand and quantity demanded? (4)

1.2 What is the relationship between quantity demanded and quantity supplied at equilibrium? (2) What is the relationship when there is a shortage? (3)

1.3 Suppose the government decided that, since gasoline is a necessity, its price should legally be capped at R1,20 per gallon. Discuss the effects of this decision.

(6)

1.4 Suppose the government decided that, in order to promote SMME's; its price should be legally be capped at R1,60 per gallon. Discuss effects of this decision. (6)

1.5 Explain why the following statement is false:

"In the goods market, no buyer would be willing to pay more than equilibrium

price".

+ 'HNEHTF . Assignment 1 sem 1 - Read-only pllEllQ Read Only You can't save changes to this f... v R1,60 s R1,40 R1,20 D 0 2 0 600 Q The gure above indicates the demand and supply for Gasoline. The price is given per gallon and quantity of gasoline in millions of gallons. 1.1 What is the difference between a change in demand and quantity demanded? (4) 1.2 What is the relationship between quantity demanded and quantity supplied at equilibrium? (2) What is the relationship when there is a shortage? (3) 1.3 Suppose the government decided that, since gasoline is a necessity. its price should legally be capped at R1 ,20 per gallon. Discuss the effects of this decision. (5) 1.4 Suppose the government decided that, in order to promote SMME's; its price should be legally be capped at R1,60 per gallon. Discuss effects of this decision. (6) 1.5 Explain why the following statement is false: \"In the goods market, no buyer would be willing to pay more than equilibrium price". (5) III C) <