Cambridge O Level Economics: Supply, and equilibrium and disequilibrium prices (2281) – Practice Questions

These are original questions written for Marlbridge, for revision and practice on this content. They are not reproduced past-paper questions, and they do not replicate the exam’s exact structure, question count or mark tariffs – examination boards hold copyright in their own papers. Use these alongside the official past papers from your board or school.

These questions are aligned to the Cambridge O Level Economics 2281 syllabus for examination in 2026, sections 2.4 (Supply) and 2.5 (Price determination). The course is not tiered, and calculators may be used. Every market, firm and figure is invented for practice.

Need a refresher first? Read the study guide or the revision notes. The Cambridge O Level Economics hub and the printable checklist show the whole course, and the free diagnostics check your level.

Questions

1. Define supply. [2]

2. Three tailors make school shirts. The table shows the shirts each will supply per week. All figures are illustrative.

Price (cu)	Tailor 1	Tailor 2	Tailor 3
8	10	6	0
10	14	10	4
12	18	14	8
14	22	18	12

(a) Calculate market supply at each price. [2] (b) A fourth tailor enters and supplies 5 shirts at every price. State the new market supply at each price. [2]

3. When the price of a meal at a street-food stall rises from 5 cu to 7 cu, the stall raises the quantity it supplies from 40 to 70 meals a day.

(a) State the term for this change. [1] (b) Calculate the percentage change in quantity supplied. [2] (c) Explain why this is not a shift of the supply curve. [1]

4. In Country B, state whether each event is an increase in supply, a decrease in supply, an extension or a contraction in the market for mangoes.

(a) A farm buys a faster harvesting machine. [1] (b) The market price of mangoes rises. [1] (c) The government puts a tax on each box sold. [1] (d) A drought cuts the size of the harvest. [1]

5. Explain why a supply curve slopes upward. [4]

6. The table shows the market for reusable water bottles at a school shop. All figures are illustrative.

Price (cu)	10	20	30	40	50
Quantity demanded	96	78	60	42	24
Quantity supplied	12	36	60	84	108

(a) State the equilibrium price and equilibrium sales. [2] (b) At a price of 20 cu, state whether there is a shortage or a surplus and its size. [2] (c) Explain what will happen to the price in a free market. [3]

7. In a market, quantity demanded is Qd = 150 - 5P and quantity supplied is Qs = 3P - 10, where P is price in cu.

(a) Calculate the equilibrium price and quantity. [3] (b) Calculate the size of the gap at a price of 12 cu and name it. [2] (c) Calculate the size of the gap at a price of 25 cu and name it. [2]

8. A stall sells iced tea. The table shows demand and supply before and after a new cooler cuts costs, which raises supply by 40 cups at every price. All figures are illustrative.

Price (cu)	4	6	8	10	12
Demand	110	90	70	50	30
Supply before	30	50	70	90	110

(a) Write out the new supply schedule. [2] (b) Calculate the percentage increase in supply at a price of 8 cu. [2] (c) Find the new equilibrium price and quantity. [2] (d) Describe how the supply curve moves and what happens to equilibrium price and sales. [2]

9. A market has 50 identical small farms. At a price of 5 cu, each supplies 12 kg of beans.

(a) Calculate market supply at 5 cu. [1] (b) Eight farms leave the market. Calculate the new market supply at 5 cu. [1] (c) Calculate the percentage change in supply. [1] (d) State what happens to the supply curve. [1]

10. In a market for second-hand textbooks the equilibrium price is 15 cu. The price is currently 20 cu, where 45 books are demanded and 85 are supplied. Sellers are free to change their prices. Explain what will happen in the market. [5]

11. The table shows the market for pomegranates in Country C. All figures are illustrative.

Price (cu per kg)	5	10	15	20	25
Quantity demanded (kg)	150	120	90	60	30
Quantity supplied (kg)	30	60	90	120	150

(a) State the equilibrium price and sales. [2] (b) A frost cuts supply by 60 kg at every price, and no seller supplies a negative amount. Write out the new supply schedule. [2] (c) Find the new equilibrium price and sales. [2] (d) At the old equilibrium price, explain what happens after the frost. [3]

Answers

1. The amount of a good or service that sellers are prepared and able to offer [1] at each possible price during a stated period [1]. [2] Examiner insight: A definition that stops at “what producers sell” is incomplete. Naming willingness and ability, and a link to price, is what shows full understanding.

2. (a) Add the three quantities at each price [1]. Totals are 16, 28, 40 and 52 shirts [1]. (b) Add 5 at each price [1]: 21, 33, 45 and 57 shirts [1]. [4] Examiner insight: Show a line of addition for at least one row. Adding down a column (adding prices) is the typical slip.

3. (a) An extension of supply [1]. (b) (70 - 40) / 40 [1] x 100 = 75% [1]. (c) The change was caused by the price of the meal itself, so it is a movement along the existing curve [1]. [4] Examiner insight: Part (c) needs the cause named (the good’s own price). Saying “because it extended” repeats the question.

4. (a) Increase in supply [1]. (b) Extension [1]. (c) Decrease in supply [1]. (d) Decrease in supply [1]. [4] Examiner insight: Match the term to the cause. Price of the good itself gives extension or contraction. Costs, technology, taxes and weather give increase or decrease.

5. A higher price means more revenue on each unit, so selling more is more profitable [1]. Producers are therefore willing to supply more [1]. Extra output often raises the cost of each additional unit, such as overtime or poorer land [1], so producers need a higher price to cover it; a high price may also attract new sellers into the market [1]. [4] Examiner insight: Linking each point to price and profit builds a chain. A list of the words “profit” and “cost” without the link tends to read as description only.

6. (a) Qd = Qs at 30 cu, so the equilibrium price is 30 cu [1] and equilibrium sales are 60 bottles [1]. (b) At 20 cu Qd = 78 and Qs = 36 [1]. Demand exceeds supply, a shortage of 42 bottles [1]. (c) Buyers cannot all get what they want and compete for the 36 bottles [1], so sellers can raise the price [1]; the rising price cuts the quantity buyers demand and raises the quantity sellers offer, until both reach 60 at 30 cu [1]. [7] Examiner insight: Give the size of the gap with units, and make the sequence run from cause to effect to the end point.

7. (a) 150 - 5P = 3P - 10 [1]. 160 = 8P, so P = 20 cu [1]. Q = 150 - 100 = 50 [1]. (b) At 12: Qd = 150 - 60 = 90 and Qs = 36 - 10 = 26 [1]. Shortage of 64 [1]. (c) At 25: Qd = 150 - 125 = 25 and Qs = 75 - 10 = 65 [1]. Surplus of 40 [1]. [7] Examiner insight: Substitute the price into both equations, then subtract. Name the gap, because a bare number leaves the answer unfinished.

8. (a) Add 40 to each supply figure [1]: 70, 90, 110, 130 and 150 [1]. (b) Increase = 40 [1]; 40 / 70 x 100 = 57.1% [1]. (c) New supply equals demand at 6 cu (90 and 90) [1]: price 6 cu, quantity 90 cups [1]. (d) The curve shifts right (an increase in supply) [1]; equilibrium price falls from 8 to 6 cu and sales rise from 70 to 90 cups [1]. [8] Examiner insight: In part (d), give the direction of both price and quantity, with the before and after values. Quoting only the direction of price leaves half the effect unstated.

9. (a) 50 x 12 = 600 kg [1]. (b) 42 x 12 = 504 kg [1]. (c) (504 - 600) / 600 x 100 = -16% [1]. (d) The market supply curve shifts left (a decrease in supply) [1]. [4] Examiner insight: A fall in the number of sellers shifts the whole curve. Writing “contraction” here confuses cause with the movement caused by price.

10. At 20 cu there is a surplus of 85 - 45 = 40 books [1]. Sellers are left with unsold stock [1], so they cut the price to attract buyers [1]. As price falls, quantity demanded extends [1] and quantity supplied contracts [1], until both are equal at the equilibrium price of 15 cu. [5] Examiner insight: Answers that only say “the price falls” show less than answers that give the reason and the two quantity responses. Finish at the point where the gap is zero.

11. (a) Qd = Qs = 90 at 15 cu, so price 15 cu [1] and sales 90 kg [1]. (b) Subtract 60 from each supply figure [1]: 0, 0, 30, 60 and 90 kg [1]. (c) Qd = Qs = 60 at 20 cu, so price 20 cu [1] and sales 60 kg [1]. (d) At 15 cu, Qd = 90 but Qs = 30, a shortage of 60 kg [1]. Buyers compete for scarce supply and bid the price up [1]. The higher price extends quantity supplied and contracts quantity demanded until both are 60 at 20 cu [1]. [9] Examiner insight: In part (b), a quantity supplied cannot be below zero, so write 0 rather than a negative figure. Check the new column against the demand table before you state an equilibrium.

Where marks are usually lost

• Using “increase” for a price-driven rise in quantity supplied instead of “extension”.
• Adding prices when asked for market supply, or adding down a column instead of across a row.
• Giving the equilibrium price without the equilibrium quantity.
• Mixing up shortage and surplus: price below equilibrium gives a shortage, price above gives a surplus.
• Not naming the size or the units of a gap.
• Explaining a price change without saying what happens to quantity demanded and quantity supplied.
• Changing both curves when the question changes one condition.
• Quoting percentage changes against the wrong base, such as dividing by the new value.

Next steps

• Revisit the revision notes for any answer you missed.
• Reread the study guide on aggregation and equilibrium.
• Check the course hub and the printable checklist.
• Try all the free 10-minute diagnostics.
• Book a free trial class: /trial/.

Official syllabus

This page follows the Cambridge O Level Economics 2281 syllabus for examination in 2026 (version 2), published by Cambridge Assessment International Education. It covers sections 2.4 and 2.5.