Neco Model Questions Vol1 2022 Economics Question 2

Practice essay / theory question 2 from the 2022 Neco Model Questions Vol1 Economics examination. This question covers Demand Shift, Price Elasticity of Demand, Market Equilibrium .

Neco Model Questions Vol1 2022 Economics Essay / Theory
Topics: Demand Shift Price Elasticity of Demand Market Equilibrium
Question 2 NECO_MODEL_QUESTIONS_VOL1 • 2022 • ECONOMICS • essay

The table below shows the quantity of wheat demanded and supplied in a local market at two different price levels before and after a government health campaign that encourages people to eat more whole‑grain wheat products. | Situation | Price per kg (₦) | Quantity Demanded (kg) | Quantity Supplied (kg) | |-----------|------------------|------------------------|------------------------| | Before campaign | 200 | 500 | 520 | | After campaign | 180 | 620 | 520 | Assume that the supply of wheat remained unchanged during the period.

Question Parts

( a )
State the direction of the shift in the demand curve and give the most likely reason for this shift based on the information provided.
( b )
Calculate the price elasticity of demand between the two price‑quantity points using the midpoint (arc) method and interpret the result.
( c )
Based on the shift in demand and the calculated elasticity, predict the likely effect on the equilibrium price and quantity, and explain your reasoning.

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About This Question

This is Neco Model Questions Vol1 2022 Economics Question 2. It is one of the essay questions from the 2022 Neco Model Questions Vol1 Economics examination.

The question covers Demand Shift, Price Elasticity of Demand, Market Equilibrium .

View More Neco Model Questions Vol1 2022 Economics Questions More Neco Model Questions Vol1 Practice Questions Back to Questions

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