5. Which of the following best describes the main idea of the text 3 - 3?

Choose the correct letter A, B, C or D.

1. The table is more convenient to read than the diagram.

2. What do the demand/supply curves show.

3. The price of the good and the quantity relationship in a diagram form.

4. When market equilibrium occurs.

6. Speaking

1. Complete the description of the diagram in Figure 1 using the terms from the box below.

The first step to understanding and analyzing the effect of promotion is to consider how promotion affects sales and revenue. The goal of promotion is to attract consumers and convince them to buy your wine over another's. Since promotion affects the demand for your wine, it is important to have a firm understanding of what the demand for your wine represents. To illustrate how promotion affects sales and revenue, we estimated the demand function for California Cabernet Sauvignon. A simplified representation of the demand for this wine is shown in Figure 1. …

demonstrates sold the greater

between and the quantity

the demand curve the higher the lower

the relationship price units

2. Describe Figure 2 and Figure 3.

Figure 2

Figure 3

Unit 8 supply and demand (2)

Text 3-4 (pages 74 - 76)

1. Read the text “Behind the Demand Curve” and choose the correct answer, a, b, c or d according to the text.

   1. The demand for cars usually decreases

1. as a result of petrol price rise.

2. with a rise in tube fares.

3. when the price of related goods remains constant.

4. instead of a decrease in the demand for buses.

1. Technological advances

1. encourage an increase in the demand for complements to the new product.

2. prevent from purchasing the lower-price new product.

3. affect the demand for the time goods

4. relate to the increase in the demand for substitutes for the new product.

1. When incomes rise

1. the demand for normal goods decreases.

2. households typically spend a little more on inferior goods.

3. an increase of consumption tends to occur.

4. consumer preferences become less affordable.

2. Complete each sentence with the correct ending, a-j, below.

1. Although each good is unique, it has substitutes –

2. When a price rises and all other influences on buying plans remain unchanged, the price rises

3. Faced with a higher price and an unchanged income, people

4. When income increases, consumers, buy more of most goods, and when income decreases,

5. Although an increase in income leads to an increase in the demand for most goods,

6. A rock music fanatic has a much greater preference for CD-Rs than does a tone-deaf technophobic, as a consequence,

7. If the price of a substitute for a CD-R rises,

1. will be one of the goods that people buy less of.

2. other goods that can be used in its place.

3. relative to people’s income.

4. cannot afford to buy all the things they previously bought.

5. the size and the age structure of the population.

6. consumers buy less of most goods.

7. the current demand for computers is less.

8. it does not lead to an increase in the demand for all goods.

9. even if they have the same incomes, their demands for CD-Rs will be different.

10. people buy less of the substitute and more CD-Rs.