Raimondi College

Economics
Past Paper exercise
Name: __________________ Class: ___________

Chapter 8-9: Demand and Supply

Multiple choice questions

Concept of Demand
1. (1990 Q15)

Which of the following will cause the demand curve if ice cream to shift from D1 to D2?

A. The cost of production of ice cream decreases.

B. More and more children enjoy drinking soft drinks.
C. The price of ice cream decreases.
D. Children are given more pocket money.

2. (1991 Q24)
Which of the following may cause the market demand for housing in Hong Kong to increase?

A. There is an influx of immigrants.

B. The interest rate has increased.
C. More housing estates are built by the government.
D. The selling price of flats has decreased.

3. (1992 Q21)
The increase in demand for container transportation will lead to an increase in demand for container
truck drivers. This is an example of

A. competitive demand.
B. joint demand.
C. derived demand.
D. excess demand.

4. (1992 Q22)
Which of the following factors will cause a decrease in the demand for imported private cars?
(1) The Organization of Petroleum Exporting Countries (OPEC) restricts the production of oil.
(2) An extension of the Mass Transit Railway to Kennedy Town is built.
(3) The price of imported private cars increases.

A. (1) and (2) only

B. (1) and (3) only
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 C. (2) and (3) only
D. (1), (2) and (3)
5. (1992 Q42)
The Housing Authority has offered to sell rental flats in public housing to the present tenants(住戶).
However, not many tenants have expressed a desire to buy the flats they are living in. Which of the
following would make the tenants more willing to buy the flats?

A. increasing the supply of flats in the private sector.

B. increasing the rents of public housing units
C. increasing the interest rates on home mortgage loans
D. increasing the quantity of Home Ownership Scheme flats allocated to tenants.

6. (1993 Q18)
In 1992, the lending ceiling(最高貸款額) on home mortgage in Hong Kong was reduced from 90% to
70% of the value of the property. This result in _________ residential property.

A. a decrease in the demand for

B. a decrease in the quantity demanded of
C. an increase in the supply of
D. an increase in the quantity supplied of

7. (1994 Q58)
Which of the following situations will NOT lead to an increase in demand for private cars?

A. the price of private cars decrease sharply.

B. More people live in the remote areas in the New Territories.
C. The fares for public transport increase.
D. The government abolishes the gasoline tax.

8. (1999 Q5)
In which of the following pairs does the demand for the first good create a derived demand for the
second?

A. digital versatile disc (DVD) and laser disc (LD) player(鐳射影碟機)

B. wool(羊毛) and mutton(羊肉)
C. hardback book and printing paper
D. electricity and light bulb

9. (2000 Q9)
Which of the following is an example of joint demand?

A. the courier service (送遞文件服務) of a local firm and the postal services of the government.
B. the Airport Express train service and the Tung Chung Line train service.
C. magazines and printing paper
D. floppy diskettes(磁碟) and floppy diskette drives(磁碟驅動器).

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10. (2009 Q5)
The demand for ________ can be regarded as a derived demand of ________ .

A. beef … leather
B. printing paper … magazines
C. pop sings … MP3 players
D. high definition digital receivers(高清電視機頂盒) … TV sets

11. (2009 Q6)

An increase in the price of flour will lead to a decrease in

A. the demand of flour

B. the supply of flour
C. the demand for bread
D. the supply of bread

12. (2012 SP Q16)

In order to reduce the number of plastic bags used, the government plans to impose a charge on
consumers according to the number of plastic bags that consumers obtain from shops.

Which of the following concepts can be used to explain the above policy?

A. the law of demand

B. the principle of comparative advantage
C. diseconomies of scale
D. the law of diminishing marginal returns

13. (2013 Q10)

Which of the following is assumed to be constant when the market demand curve of a good is derived?
(1) the income of the consumers
(2) the price of the good
(3) prices of related goods
(4) preference of the consumers

A. (1) and (3) only

B. (2) and (3) only
C. (1), (2) and (4) only
D. (1), (3) and (4) only

14. (2014 Q12)

In which of the following pairs does the demand for the first good create a derived demand for the
second one?

A. Aviation service and pilots

B. West Rail Line train service and Light Rail train service
C. Blu-ray discs and Blu-ray disc players
D. Hong Kong Disneyland and Ocean Park Hong Kong

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15. (2016 Q13)
Which of the following situations would lead to an increase in the demand for private housing?

A. The price of private housing decreases.

B. The supply of public housing increases.
C. People expect the interest rate for mortgage loans to increase later.
D. People expect the price of private housing to increase later.

16. (2016 Q14)

The demand for _____ can be regarded as a derived demand for _____.

A. coffee beans......coffee
B. selfie sticks (自拍桿) ......digital cameras
C. chicken wings......chicken legs
D. newspapers......printing paper

17. (2016 Q17)

The demand for construction workers in Hong Kong will increase if

A. the legal procedures for urban re-development are simplified.

B. wage rates of construction workers decrease.
C. the government provides more allowances for training programmes for the construction
industry.
D. there are fewer job opportunities in the construction industry in Macau.

18. (2017 Q14)

Which of the following situations would most likely lead to an increase in the demand for iPhone
produced by Apple Inc.?

A. A technological breakthrough in the battery industry reduces its production cost.

B. People expect the next model of iPhone will have more innovative features.
C. A model of Samsung smartphone is banned by many airlines.
D. Apple Inc. reduces the selling price of iPhone.

19. (2021 Q13)

The demand for ____________ can be regarded as a derived demand for ______________.

A. mobile phones … earphones

B. laptops … batteries
C. music videos … singers
D. game programmers … online games

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Concept of Supply

20. (1996 Q4)

The supply of secondary school teachers will increase if

A. the government provides a subsidy for schools to employ more language teaches.
B. The government increases the salary of teachers.
C. The number of children eligible for secondary education increase.
D. The number of job vacancies in the business field decreases.

21. (2011 Q5)

Which of the following is an example of competitive supply?

A. compact discs and compact disc players

B. residential buildings and commercial building
C. textbooks and printing paper
D. bread and butter

22. (2015 Q14)

Holding other factors constant, a rise in the price of Good X will lead to a fall in the total revenue of
Good Y if

A. Good X and Good Y are complements.

B. Good X and Good Y are substitutes.
C. Good X and Good Y are in joint supply.
D. Good X and Good Y are in competitive supply.

23. (2020 Q12)

When the market supply curve of a good is derived, which of the following is/are assumed to be
constant?

(1) the market price of the good

(2) the prices of factors of production of the good
(3) the expected future price of the good

A. (1) only
B. (2) only
C. (3) only
D. (2) and (3) only

24. (2021 Q14)

When Good X and Good Y are _______________, a decrease in the supply of Good X will result in an
increase in the __________________ Good Y.

A. substitutes … supply of
B. substitutes … quantity supplied of
C. complements … demand for
D. complements … quantity supplied of

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25. (2022 Q17)
If the price of __________ increases, the supply of _________ will decrease.
(1) flour … bread
(2) beef … leather
(3) car … gasoline
(4) commercial building … industrial buildings

A. (1) and (3) only

B. (1) and (4) only
C. (2) and (3) only
D. (2) and (4) only

Change in equilibrium rice and quantity

26. (1990 Q17)

Which of the following will cause a fall in the equilibrium price of petroleum in a country?

A. The country imposes a quota on the imported oil.

B. The cost of exploration for oil increases substantially.
C. The country undergoes rapid industrialization.
D. A cheap substitute for oil has been discovered.

27. (1991 Q57)

Which of the following would NOT lead to an increase in the total revenue from the sale of a product?

A. an increase in its demand

B. an increase in its selling price
C. a decrease in its demand
D. a decrease in its selling price

28. (1993 Q57)

The price of textbooks in Hong Kong has greatly increased in recent years. Which of the following is
NOT a possible reason for this?

A. more frequent revision(改版) of textbooks

B. more publishers publishing textbooks
C. increasing wages and rents
D. the photocopying of textbooks becoming more costly

29. (1994 Q7)

If the price of movie tickets increase and the rental of laser discs falls, then the equilibrium price of
laser disc players

A. will remain unchanged.

B. will increase..
C. will decrease.
D. may increase or decrease.

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30. (1996 Q6)
Suppose the price of compact discs decreases. The prices of compact disc players will __________and
the demand for cassette tapes will ___________.

A. rise … increase
B. rise … decrease
C. fall … increase
D. fall … decrease

31. (1997 Q7)

Suppose the government raised the water charge in January 1997. What would be the result?

A. a decrease in the demand for water.

B. a decrease in average household water consumption
C. a decrease in the government revenue from the water charge
D. a decrease in the cost of production of restaurants because they would use less water

32. (1997 Q8)

If there is a poor harvest of rice in Thailand, the total expenditure of Thai rice in Hong Kong

A. would increase because of a price rise

B. would decrease because of the availability of substitutes
C. would be more or less the same because of availability of substitutes.
D. may increase or decrease, depending on the price elasticity of demand of Thai rice.

33. (1998 Q9)

Suppose the price of oranges increases and the quantity of oranges transacted decreases in H.K., this is
likely caused by

(1) a rise in transportation cost.

(2) a fall in the price of apples
(3) the fact that oranges have proved useful in reducing the chance of catching a cold
(4) a serious bad harvest of oranges in the U.S.A.

A. (1) and (2) only

B. (1) and (4) only
C. (2) and (3) only
D. (3) and (4) only

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34. (2000 Q6)
Hong Kong’s recent economic recession has caused a decline in people’s income. In view of this, the
government decided to lower the effective minimum wage level of Filipino maids. As a result of these
TWO changes,

(1) the demand for Filipino maids should decrease.

(2) the quantity supplied of Filipino maids should decrease.
(3) the excess supply of Filipino maids should decrease.
(4) the total expenditure on the employment of Filipino maids should drop.

A. (1) and (2) only

B. (2) and (3) only
C. (1), (2) and (3) only
D. (1), (3) and (4) only

35. (2001 Q3)

‘Compared to last year, more watermelons were sold this summer and the price was lower.’ This is
because there was a (an) _________ in the __________ watermelons.

A. increase ... demand for

B. decrease ... demand for
C. increase ... supply of
D. decrease ... supply of

36. (2001 Q4)

‘A rise in the price of a good will cause a decrease in demand for it and an increase in its supply.’
The above statement is

A. correct because a change in price will change both demand and supply.
B. incorrect because a rise in price will only increase the supply.
C. incorrect because a rise in price will only decrease the demand.
D. incorrect because both demand and supply will not change as a result of a change in price.

37. (2002 Q8)

After a good harvest, the price of choi-sum has changed by 50% and the quantity transacted has
changed by 40%. Which of the following statements is/are correct?

(1) The quantity demanded of choi-sum has increased.

(2) The demand for choi-sum has increased.
(3) The total revenue from selling choi-sum has increased.

A. (1) only
B. (1) and (2) only
C. (2) and (3) only
D. (1), (2) and (3)

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38. (2003 Q8)
According to research evidence, one of the substances in bear has proved to be good for the healthy
development of bones. This will lead to an increase in

(1) the supply of beer

(2) the quantity transacted of beer •
(3) the demand for beer

A. (1) and (2) only

B. (1) and (3) only
C. (2) and (3) only
D. (1), (2) and (3)

39. (2003 Q9)

The government has imposed a fee for using the emergency services provided by public hospitals. As a
result, patients’ total expenditure on private medicals services

A. will decrease
B. will increase
C. will remain unchanged
D. may increase or decrease

40. (2004 Q5)

Suppose a bill is passed that punishes the buyers of pirate compact discs (CDs). The price of pirated
CDs would _________ and the quantity transacted would _________.

A. increase ... increase

B. increase ... decrease
C. decrease ... increase
D. decrease ... decrease

41. (2004 Q8)

Suppose an airline reduces the price of its air tickets. As a result,

A. the demand for its air tickets will increase.

B. the number of its passengers will increase.
C. the supply of its aircraft service will increase.
D. its sales revenue will increase.

42. (2005 Q4)

Suppose consumers of traditional eye-classes gradually change to using contact lenses. As a result, the
equilibrium price of traditional eye-classes will ___________ and the sales revenue of traditional eye-
glass sellers will ____________.

A. rise... increase
B. rise... decrease
C. fall... increase
D. fall... decrease

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43. (2006 Q6)
An increase in the price of petroleum will lead to a decrease in

A. the demand for petroleum

B. the demand for mini-bus services
C. the supply of mini-bus services
D. the supply of mini-bus drivers

44. (2006 Q7)

Nowadays, more schools in Hong Kong have implemented reading programs to develop students'
reading habits. This would lead to an increase in

A. both the demand for and the supply of books

B. both the demand for and the quantity supplied of books
C. both the supply and the quantity demanded of books
D. both the supply and the quantity supplied of books

45. (2006 Q8)

Which of the following would lead to a fall in price and an increase in quantity sold of imported
Japanese television sets in Hong Kong?

A. The transportation cost of goods from Japan to Hong Kong increases.

B. An increasing number of lower-priced similar models of television sets are imported from
Korea
C. The Japanese technology in producing television sets improves
D. The salaries tax rate in Hong Kong decreases
46. (2006 Q49)
In order to reduce the amount of household garbage disposed of, the government is planning to impose
a household garbage disposal charge according to the amount of garbage disposed by each household.

Which of the following concepts can be used to explain the above policy?

A. law of demand
B. principle of comparative advantage
C. diseconomies of scale
D. law of diminishing marginal returns

47. (2007 Q5)

Suppose the technology required to produce LCD TV sets advances. The price of LCD TV sets will
_______ and the price of traditional CRT TV(傳統顯像管電視機) sets will _________.

A. rise … rise
B. rise … fall
C. fall … rise
D. fall … fall

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48. (2007 Q10)
A possible cause of an increase in both the world market price and the quantity transacted of gasoline
could be ____________.

A. a warmer than usually weather during winter around the world

B. a rapid industrial development of newly developing countries
C. oil production cuts the Organization of Petroleum Exporting Countries (OPEC)
D. a decrease in the price of crude oil(原油) which is used to produce gasoline

49. (2009 Q6)

An increase in the price of flour will lead to a decrease in

A. the demand for flour

B. the supply of flour.
C. the demand for bread.
D. the supply of bread

50. (2010 Q6)

Suppose both the price and quantity transacted of imported rice decrease. This is likely to be caused by

A. an increase in the transportation cost resulting from a higher fuel price.

B. a change in taste from consuming rice to consuming noodles.
C. a bad harvest of rice.
D. an increase in the income of households given that rice is a normal good.

51. (2010 Q7)

Most Hong Kong use either town gas or electricity for cooking. Suppose there is a drastic increase in
electricity charges. Consumers’ expenditure on electricity consumption ___________ but their
expenditure on town gas consumption _________.

A. will increase … will increase

B. will increase … may increase or decrease
C. may remain unchanged … will decrease
D. may increase or decrease … will increase

52. (2011 Q9)

The government has imposed an environmental levy on plastic shopping bags but not on non-woven
reusable bags (不織布袋).

Suppose there was also an increase in the number of producers of non-woven reusable bags. As a
result, the total sales revenue of non-woven reusable bags _________.

A. would increase
B. would decrease
C. would remain unchanged
D. might increase, remain unchanged or decrease

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53. (2013 Q12)
A drop in the price for good X will lead to a drop in the price of good Y if

(1) good X and good Y are substitutes.

(2) good X and good Y are complements.
(3) good X and good Y are in competitive supply.
(4) good X and good Y are in joint supply.

A. (1) and (3) only

B. (1) and (4) only
C. (2) and (3) only
D. (2) and (4) only

54. (2017 Q17)

Suppose Good Y is an inferior good. When people's income rises and the production cost of Good Y
increases, the equilibrium price of Good Y _____.

A. will increase
B. will decrease
C. will remain unchanged
D. may increase or decrease

55. (2018 Q20)

The following table shows the number of new Tesla electric vehicle registered in Hong Kong.

Month Number of new Tesla electric vehicle registered in Hong Kong

December 2016 168
January 2017 168
February 2017 590
March 2017 2939

The Government announced in mid-February 2017 that the full exemption from first registration tax on
electric vehicles would end on March 31, 2017.
Which of the following best explains the above data?

A. The supply of electric vehicles increased because new technology reduced the production cost of
battery used in electric vehicles.
B. The supply of electric vehicles increased because of the exemption of first registration tax by the
Government.
C. The demand for electric vehicles increased because the Government built more charging stations in
the city.
D. The demand for electric vehicles increased because the buyers expected the cost of buying electric
vehicles to go up in the future.

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Diagram application:

56. (1993 Q26)

Technological breakthrough has reduced the production cost of calculators. At the same time, there
have been less students sitting for the CE examinations and requiring for the use of calculators.
Suppose these two factors have caused the price pf calculators to fall. Which of the following graphs
helps to illustrate the above situation?

57. (1995 Q13)

Refer to the diagram below. E0 is the initial equilibrium point of the toy market in the U.S. After a
sharp increase in the price of raw materials and a boom in the US economy, the new equilibrium point
will be

A. Ea
B. Eb
C. Ec
D. Ed
13
58. (1994 Q6)
In Hong Kong, the number of taxi licenses is controlled by the government. In a certain year, it was
found that the price of taxi licenses increases after the government issued more taxi licenses. Which of
the following diagram illustrates the above situation?

59. (1999 Q12)

In the following diagram, E0 is the initial equilibrium point of the market for Hong Kong’s garment
products in the U.S. Suppose there is an increase in import duties in the U.S. and many U.S. retailers
order from other Asian countries instead of Hong Kong, the new equilibrium point in the diagram would
be

A. Ea
B. Eb
C. Ec
D. Ed
14
60. (1997 Q5)
When the mad cow disease broke out in 1996, many cows were destroyed. Which of the following
diagrams best describes the effects on the beef market?

61. (1997 Q6)

The Mass Transit Railway Corporation (MTRC) encourages the adoption of a flexi-time-office-hours
scheme (彈性上班時間) to reduce the overcrowding of passengers during the rush hours. Hence,
passengers using the Nathan Road Route before 8:00 a.m. and between 9:00 a.m. and 9:30 a.m. will
have a discount on their MTR fares.

Which of the following diagram could be a result of such a measure of the MTRC?

15
62. (1998 Q10)
Suppose the rice production in Thailand suffers a serious fall in output and hence less rice is exported
to Hong Kong. Which of the following is a result of this event?

63. (2000 Q7)

The diagram above shows the market of tours for Hong Kong people Japan. The initial equilibrium is at
E0. Because of economic recession, fewer Hong Kong people spend their holiday in Japan. Moreover,
the Japanese Yen appreciates against the Hong Kong dollar.

The new equilibrium point in the market will be at

A. Ea
B. Eb
C. Ec
D. Ed
16
64. (2000 Q12)
Which of the following diagrams shows the result of an improvement in the technology used in
producing digital versatile disc (DVD) players?

65. (2001 Q5)

Which of the following diagrams shows the result of a significant increase in the annual licence fee for
private cars?

17
66. (2001 Q10)
The diagram below shows the supply and demand curves of imported Japanese automobiles in Hong
Kong. The original equilibrium point is at E.

If there is an increase in the transportation cost from Japan to Hong Kong and more similar models of
Korean automobiles with cheaper price are imported, the new equilibrium point will be at

A. E1
B. E2
C. E3
D. E4

67. (2002 Q7)

Refer to the following diagram.

Which of the following would lead to the above change in demand from D1 to D2?

A. an increase in the toll fee for taxis using the cross harbour tunnels
B. an increase in the frequency of cross harbour bus services
C. a fall in the wage rate of bus drivers
D. a fall in the ticket price for Mass Transit Railway services

18
68. (2002 Q9)
The diagram below shows the supply and demand schedules of the market for airline tickets in Hong
Kong. The original equilibrium point is at E.

If, as a result of a terrorist attack, fewer people travel overseas and the insurance premium of airlines
rises to a high level, the new equilibrium point will be at

A. E1
B. E2
C. E3
D. E4

69. (2002 Q50)

At the outbreak of war in the Middle East, civil aircraft which used to fly through the nearby air space
had to fly longer routes in order to stay away from the war areas. Moreover, the risk of travelling by
civil aircraft was also higher.

Which of the following diagrams about the effects of these changes is INCORRECT?

19
70. (2003 Q14)
Which of the following diagrams shows the result of a significant reduction in the post of storing and
transportation chilled chicken(冰鮮雞) from the mainland of China to Hong Kong?

71. (2004 Q6)

Suppose the Hong Kong government imposes a toll on highway users.

The above graph shows the effect of the above toll on the market of

A. Mass Transit Railway (MTR) services.

B. private motor cars.
C. gasoline.
D. school bus services.
20
72. (2004 Q7)
The following diagram shows the market supply and demand curves of face masks in Hong Kong.
The original equilibrium point is E.

Suppose more people decide to wear face masks to prevent the spread of respiratory diseases and there
is an increase in the number of face mask producers. As a result, the new equilibrium point would be

A. W
B. X
C. Y
D. Z

73. (2005 Q5)

In the following graph, E0 was the original equilibrium point of the seafood market in Hong Kong.

Last year a number of people was poisoned by seafood. At the same time, fishermen’s harvest(漁獲)
decreased. As a result, what would be the new equilibrium point in the graph?

A. Ea
B. Eb
C. Ec
D. Ed

21
74. (2006 Q5)
The following diagram shows the private housing market. Point E is the original equilibrium point.

Suppose there is an increase in both the home mortgage interest rate and the labour cost of private
house construction. The new equilibrium point in the diagram would be

A. W
B. X
C. Y
D. Z

75. (2007 Q4)

The diagram below shows the supply and demand curves of hotel accommodation in Macau. The
original equilibrium point is at E.

More and more hotels start operating in Macau and it is becoming more popular to visit the place. The
new equilibrium point will be ____

A. W
B. X
C. Y
D. Z
22
76. (2008 Q4)
The following diagram shows the market of exhibition spaces in Hong Kong

An increase in the __________ would lead to a shift of the demand curve from D1 to D2 in the diagram.

A. rental of exhibition spaces in Hong Kong

B. rental of exhibition spaces in Macau
C. number of trade fairs held in Hong Kong
D. exhibition spaces in Macau

77. (2008 Q5)

The diagram below shows the supply and demand curves of residential property in Hong Kong.
The original equilibrium point is at E.

If the population of Hong Kong increases and the wage rate of local construction workers rises, the new
equilibrium point will be at __________.

A. E1
B. E2
C. E3
D. E4
23
78. (2009 Q7)
The diagram below shows the supply and demand curves of mainland China's milk powder products in
Hong Kong. The original equilibrium point is at E.

Some of these milk powder products were found to contain the substance, melamine(三聚氰胺) and
some mainland milk powder producers left the industry. One possible new equilibrium point of the
above diagram is at ___________.

A. E1
B. E2
C. E3
D. E4

79. (2010 Q8)

The diagram below shows the supply and demand curves of swine flu(豬流感) vaccine in Hong Kong.
The original equilibrium point is at E.

If the number of the swine flu vaccine manufacturers increases and the risk of being infected by swine
flu increases, one possible new equilibrium point of the above diagram is at

A. E1
B. E2
C. E3
D. E4
24
80. (2011 Q6)
The diagram below shows the supply and demand curves of imported Japanese automobiles in Hong
Kong. The original equilibrium point is at E.

Suppose it is rumoured that there are technical problems with Japanese automobiles that may cause
traffic accidents. At the same time, the Japanese Yen appreciates against the Hong Kong dollar.
The new equilibrium point will be at __________.

A. E1
B. E2
C. E3
D. E4

81. (2012 SP Q15)

The following diagram shows the hotel accommodation market in London. Point E is the original
equilibrium point.

Suppose there is a bomb attack in a tube (subway) station and there is a rise in the operating cost of
hotels in London. The new equilibrium point in the diagram would be ___________.

A. W
B. X
C. Y
D. Z

25
82. (2012 PP Q10)
In the following diagram, Eo is the initial equilibrium of the market for printed books in Hong Kong.

Suppose there is a trend to read electronic books and there is a rise in the price of printing paper. The
new equilibrium point in the diagram will be __________.

A. Ea
B. Eb
C. Ec
D. Ed

83. (2012 Q13)

A train accident seriously affects the confidence of travellers using a high-speed train service. At the
same time, the airlines are facing the problem of rising fuel prices. Which of the following diagrams
could represent a result of the above events?

26
84. (2012 Q15)
The following is the demand-supply diagram of a property market. E0 is the original equilibrium point.

If the government increases the stamp duties levied on property buyers and tightens the controls on
dumping of construction waste, the new equilibrium point in the property market will be ___________.

A. E1
B. E2
C. E3
D. E4

85. (2013 Q11)

Refer to the following demand-supply diagram showing the market of luxury watches in Hong Kong.
The initial equilibrium point is E0.

Suppose the rental of shopping premises in Hong Kong rises sharply and the economy in the mainland
experiences a recession. The new equilibrium point will be _________.

A. E1
B. E2
C. E3
D. E4
27
86. (2014 Q14)
Suppose the equilibrium point of the cosmetic surgery market in Hong Kong is originally at Eo. If
people become open-minded to cosmetic surgery while more regulations are imposed on the cosmetic
surgery industry, the new equilibrium point will be at _____.

A. E1
B. E2
C. E3
D. E4

87. (2015 Q15)

SS is the supply curve for smartphones. Which of the following reasons can best explain the change of
the equilibrium position in the smartphone market from A to B.

A. The retailers offer more free gifts for buying smartphones.

B. The size of a tablet computer with a phone function is reduced.
C. There are more smartphone producers in the market.
D. The major network service providers increase the service charge at the same time.
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88. (2016 Q16)
The diagram below shows the supply and demand curves of taxi services in Hong Kong. The original
equilibrium is at E.

New apps for smartphone such as "Uber" have been developed that enable some private car owners to
provide the general public with personalised point-to-point transport service. At the same time, the fuel
price has decreased significantly. The new equilibrium point will be at _____.

A. E1
B. E2
C. E3
D. E4

89. (2018 Q13)

Refer to the above diagram. The price of farming tools will

A. rise because farm products and farming tools are in joint demand.
B. fall because farm products and farming tools are in joint demand.
C. rise because demand for farm products creates a derived demand for farming tools.
D. fall because demand for farm products creates a derived demand for farming tools.
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90. (2018 Q16)
The diagram below shows the supply and demand curves of air-purifiers. The original equilibrium
point is E.

Suppose there is a technological advance in producing air-purifiers. At the same time, the average air
pollution index has been increasing over the last decade. The new equilibrium point will be at _________.

A. E1
B. E2
C. E3
D. E4

91. (2020 Q14)

Refer to the following supply-demand diagram for Good Y.

Suppose Good Y is an inferior good and the initial market equilibrium point is E. If there is a fall in the
average income level of consumers, the new market equilibrium point will be _____.

A. A
B. B
C. C
D. D
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92. (2019 Q13)
The following is the supply-demand diagram of e-sports equipment. The initial equilibrium point is E0.

Suppose the government promotes e-sports by subsidising e-sports equipment manufacturers as well as
the e-sports training programmes. The new equilibrium point will be _____.

A. E1
B. E2
C. E3
D. E4

93. (2022 Q13)

The diagram below shows the demand and supply curves of webcams. The initial equilibrium point is E0.

Suppose more firms replace face-to-face meetings with online meetings using video-conferencing
software such as Zoom. At the same time, the price of lens used to produce webcams increases. As a
result, the new equilibrium point will be__________.

A. E1
B. E2
C. E3
D. E4

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94. (2022 Q14)
The following diagram shows the demand curve of private housing.

Which of the following can best explain the change in equilibrium position from X to Y?

A. The household income decreases.

B. People expect a price drop in private housing.
C. The wage rates of construction workers increase.
D. The demand for commercial buildings decreases.

Market disequilibrium: excess demand and excess supply

95. (2015 Q13)

Many people queued up for days for the tickets to watch the show of Tsz-Wah, a famous artist performing
stand-up comedy. Some people complained that they were unable to buy tickets even though they were
willing to pay the ticket price set by the organiser. The above situation implies that

A. price was the only criterion for allocating the tickets.

B. the producer was not maximising its profit.
C. a black market for the tickets might emerge.
D. there was an effective price ceiling in the ticket market.

96. (2018 Q15)

The average waiting time for public housing is 4.7 years according to the data from the Housing
Authority.

Which of the following would lead to an increase in the waiting time for public housing in the long term?

A. a financial aid offered to low-income families renting private residential flats

B. a rise in the income limit of applying for public housing
C. a relaxation of rules regulating the change of land use
D. a provision of shared-housing units by a billionaire for the applicants of Comprehensive
Social Security Assistance Scheme

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