Changes in Supply and Demand Essential Question: How do changes in supply and demand impact the market price of goods and services?

Why do you think this increase in the cost of inputs (ingredients) has caused producers to offer fewer cookies for sale at all prices? 1. (in dollars) Price Quantity (in dozens)

Why do you think this increase in the cost of inputs (ingredients) has caused producers to offer fewer cookies for sale at all prices? Due to increasing costs, there is less profit in each dozen, resulting in decreased profit motive at all prices 1. (in dollars) Price Quantity (in dozens)

Describe the position of the new supply curve in relation to the original supply curve. 2. (in dollars) Price Quantity (in dozens)

Describe the position of the new supply curve in relation to the original supply curve. The new supply curve (S2) has shifted to the left of the original supply curve (S1), showing that less will be supplied at all prices 2. (in dollars) Price Quantity (in dozens)

3. What is the new market price for a dozen cookies? “The Supply and Demand for Cookies” 3. (in dollars) Price Quantity (in dozens)

3. What is the new market price for a dozen cookies? “The Supply and Demand for Cookies” 3. $6 (in dollars) Price Quantity (in dozens)

“The Supply and Demand for Cookies” How many dozens of cookies will be bought and sold at the new market price? “The Supply and Demand for Cookies” 4. (in dollars) Price Quantity (in dozens)

“The Supply and Demand for Cookies” How many dozens of cookies will be bought and sold at the new market price? “The Supply and Demand for Cookies” 4. (in dollars) Price 2,600 Quantity (in dozens)

Events that Can Lead to a Change in Demand Economics Events that Can Lead to a Change in Demand A Change in Consumer Income A Change in Consumer Tastes A Change in the Price of Substitutes A Change in Demand A Change in the Price of Complements A Change in Consumer Expectations A Change in the Number of Consumers

Increase in Demand Decrease in Demand When there is an increase in demand, the demand curve will shift to the right. This indicates that more is being demanded at every price. As a result, the market price will increase.

Increase in Demand Decrease in Demand When there is an increase in demand, the demand curve will shift to the right. This indicates that more is being demanded at every price. As a result, the market price will increase. When there is a decrease in demand, the demand curve will shift to the left. This indicates that less is being demanded at every price. As a result, the market price will decrease.

Events that Can Lead to a Change in Supply Economics Events that Can Lead to a Change in Supply A Change in The Cost of Inputs A Change in Productivity A Change in Technology A Change in Taxes and Subsidies A Change in Producer Expectations A Change in Supply A Change in the Number of Sellers A Change in Government Regulations A Natural Disaster (not in the textbook)

Increase in Supply Decrease in Supply When there is an increase in supply, the supply curve will shift to the right. This indicates that more is being supplied at every price. As a result, the market price will decrease.

Increase in Supply Decrease in Supply When there is an increase in supply, the supply curve will shift to the right. This indicates that more is being supplied at every price. As a result, the market price will decrease. When there is a decrease in supply, the supply curve will shift to the left. This indicates that less is being supplied at every price. As a result, the market price will increase.

“The Supply and Demand of Tomatoes” Price Per Pound (in dollars) MP² MP¹ D Q² Q¹ Quantity (in hundreds of pints)

Changes in Supply and Demand – Partner Activity NAME _______________________________ Economics Changes in Supply and Demand – Partner Activity Create four examples that could impact the market price of different commodities. List the commodity and describe a hypothetical event that would change the market price. Two of these events should impact supply, and the other two should impact demand. Commodity: Event: Event Your partner will create a graph to demonstrate each example. Each graph should: include a title, have the price & quantity axis properly labeled, have each supply and demand curve properly labeled, and demonstrate the change in market price & quantity with dotted lines