The Paul H. Nitze School of Advanced International Studies
The Johns Hopkins University
PROBLEM SET I
1. Demand and supply.
Show in a diagram the effect on the demand curve, the supply curve,
the equilibrium price and quantity of each of the following pairs of events, occurring
a. The market for school books at the beginning of September 2018.
i. The price of paper goes down because of the adoption of a new and more efficient
technological production process;
ii. Due to a school reform students are required to buy a greater number of school books per
b. The market for Italian peaches.
i. Farmer salaries go up due to a new regulation on the labor market that reduces short-term
contracts as a form of employment in the agricultural sector;
ii. A rising sensitivity towards a balanced diet that includes fruit and vegetables.
c. The market for pay-TV football events in Italy.
i. The famous football player Cristiano Ronaldo joined Juventus club;
ii. The introduction of a new digital platform called Dazn in August 2018, creating a new
market for streaming services, that offers live and on-demand streaming of events.