BAB 2 A. MULTIPLE CHOICE 1. C 2. B 3. B 4. B 5. C 6. D 7. B 8. D 9. E 10. B B. ESSAY 1.

consumption is the direct usage of goods and services to fulfill ones needs - production is making goods or providing services - within distribution activities are trading, transportation, warehousing,and taking all the risk until the goods / services deliver to the hands of the costumers 2. consumption : the main purpose of consumption is to fulfill ones need - production : the main purpose of production is value adding - distribution : the main purpose of distribution is merely delivering goods 3. kurva indiferen 4. diagram the flow of economic activity 5.

BAB 3 A. MULTIPLE CHOICE 1. E 2. B 3. C 4. A 5. C 6. A 7. A 8. B 9. C 10. B. ESSAY 1.) demand: the number of products that consumers want and can be purchased at various price levels within a certain period with regard factors influencing it constant / fixed 2.) A. factors influencing demand are : price of goods or services, individual income, price of related goods / services, personal tastes, and consumers expectations B. and factors influencing supply are : price, resources, technology, producers expectation 3.) supply will be inelastic if the increase of the quantities offered done with high cost. If the supply is added with moderate additional cost. Then the supply will be elastic 4.) the law of demand states that the demand quantity of a commodity and its price are inversely related, if other things remain constant (ceteris paribus) 5.) The shift individual demand curve occurs when one of the conditions cateris Paritus subject to change, then the entire demand curve will experience a shift. This is referred to as changes in demand that is as opposed to a change in quantity demanded, which is a movement along the demand curve the same. 6.) 7.) Effect of time of analysis on the elasticity of supply is divided into three: - A very short period. In a very short period of time, the seller / producer can not increase its bid, so the supply becomes perfectly elastic. - Short term. The production capacity can not be added in the short term, but the company can still increase production with the available capacity by utilizing the factors of production available. As a result, supply can be raised in a relatively small percentage, so that supply is inelastic. - Long-term. Production and supply of goods more easily raised in the long term, so that supply is more elastic. 8.) Equilibrium price is the price at which the supply of a good equals to the quantity demanded , that is where the supply curve intersects with the demand curve. 9.) market Equilibrium can change. The change is due to either the change of demand or supply. If the reason behind the change is the price, then the Equilibrium will go back to the starting point. Other wise, if it is because of the

change in one of the cateris paribus factors, such as technology for the supply side, or income for the demand side, then the Equilibrium will not go back to the starting point. 10.) The main factor in determining the elasticity of demand: 1. Product substitution. More and more product replacement (substitution), the more elastic demand. 2. Percentage of income spent. The higher the income used to spend such products, the more elastic the demand .. 3. Luxury products versus needs. price increases tend not to reduce demand. Conversely, the demand for luxury products tends to elastic, a result, price increases will reduce demand. 4. The term of the demand analysis. The longer the time period analyzed demand, the more elastic the demand for a product very important factor in determining the elasticity of supply: 1. The ability of the seller / manufacturer to change the amount of production. Offers will tend not elastic when - Costs of production to increase the number of large deals. 2. Duration analysis. - A very short period. In a very short period of time, the seller / producer can not increase its bid, so the supply becomes perfectly elastic. - Short term. The production capacity can not be added in the short term, but the company can still increase production with the available capacity by utilizing the factors of production available. As a result, supply can be raised in a relatively small percentage, so that supply is inelastic. - Long-term. Production and supply of goods more easily raised in the long term, so that supply is more elastic.