The purpose of this exercise is to demonstrate how changes in quantity demanded at a specific price affect the equilibrium price and quantity.
Let's consider the market for GOOD-X. The table displayed below lists the quantity of GOOD-X demanded at various prices. The market demand curve for GOOD-X is obtained by plotting this data.
Similarly, in the case of market supply for GOOD-X, the table shown below lists the quantity of GOOD-X supplied at various prices. We obtain the market supply curve for GOOD-X by plotting this data.
The graph drawn below plots market demand and market supply curves for GOOD-X. The equilibrium quantity and price are also indicated on the graph at the point where the two curves intersect.
Now, you are allowed to make changes to the market demand curve. You must input a price and the quantity demanded at that particular price if the price you entered does not exist in the initial demand schedule. If the price you entered exists in the initial demand schedule, then you will enter the additional quantity demanded at that price.
After inputting the required information, click on the 'Start Simulation' button to render the new market demand schedule, the new market demand curve, the market supply curve, and determine the new equilibrium quantity and price.