Question

Demand and Supply
Indicate the impact of the following changes on the market for street races/road races/walk races on Price, Quantity Demand, Quantity Supply, Demend and Supply in the table provided. Indicate the direction of the change using either +, -, 0 in the space provided.

a. The number of racers increases
Variable Change
D
S
P
QS
QD

b. The number of events held doubles
Variable Change
D
S
P
QS
QD

c. Preferences switch from running to swimming events (1 mark for each variable change)

Variable Change
D
S
P
QS
QD

d. The price of a purchasing a ticket for a substitute sport event (field events or netball, e.g.) halves (1 mark for each variable change)
Variable Change
D
S
P
QS
QD

Answer 1

a.) When number of racers increases, the supply of racing events increase are there are more participants now. The demand is not affected by this. Hence:

D= 0, S= +, P = -, QS= +, QD= +

b.) When the number of events increases, again the supply of races increases. Hence:

D= 0, S= +, P = -, QS= +, QD= +

c.) When the consumers prefer swimming to running, the demand falls but the supply remains unchanged. Hence:

D= -, S= 0, P = -, QS= -, QD= -

d.) When price of a substitute event decreases, consumer will shift to the cheaper good. Therefore, Demand falls but supply remains unchanged. Hence:

D= -, S= 0, P = -, QS= -, QD= -

Below are graphical depiction of the same.