3.1
Use a graph to explain the effect of an imposition by the government of
a maximum price in the face mask market.
(7)
3.2
Briefly describe any four (4) factors that could result in a product having
an inelastic demand.
(8)
3.1
The market is distorted by a maximum price, which leads to disequilibrium. Because demand exceeds supply, many consumers will be unable to obtain the goods at all.
3.2
The availability of substitutes, whether the commodity is a luxury or a necessity, the proportion of income spent on the good, and the amount of time since the price changed are the four elements that influence price elasticity of demand.
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