Supply and Demand Objective: To understand how the supply and demand curve shifts Warm-Up 1)How are the supply schedule and supply curve related? Why does the supply curve slope upward? 2)Draw a graph with both supply and demand curves. Suppose the price of sugar goes up because of a hurricane. What happens to the supply of ice cream? Show the curve shift.
Market for Leather Jackets Supply Shifts
New Sewing Machines Developed
Supply shifts to the right because of a change in technology
Leather Manufacture goes out of Business
Supply shifts to the left because of a decrease in the number of suppliers/producers
Price of Lining Material Rises
Supply shifts to the left because of rising input costs
Tariffs on Imported Leather Jackets, Impact on Imports
Supply shifts left because of a change in government policies
Mad Cow Disease Hits US
Supply shifts to the left because of a natural disaster, cows will be destroyed, rather than come to the market
Shifts in Supply or Demand Curve Draw a correct graph, showing which curve shifted and what happened to price and quantity.
Market: Coffee Bountiful crop of Coffee Beans
Supply increases, shifts to the right Price falls, quantity increases
Market: Automobile Industry Workers in the Automobile Industry receive a pay raise.
Supply shifts to the left because of input costs rising Price increases, quantity falls
Market: Computer software Price of personal computers fall
Demand shifts to the right because of the price of a complement falls Price rises, quantity increases
Market: Pepsi Cola Price of Coca Cola rises
Demand for Pepsi increases because the price of a substitute good rises price increases, quantity increases
Market: Second Hand Clothing National Incomes Rise
Demand shifts to the left because the change in income causes a decrease in demand for an inferior good price falls, quantity falls
Market: Automobile Industry Government gives GM and Chrysler a subsidy
Supply shifts to the right because of a change in government policies price falls, quantity increases
Market: Corn Price for irrigation equipment falls
Supply increases because of a change in technology price falls, quantity increases
Market: Any normal good American’s Income falls 3 months in a row
Demand increases because incomes rising and increase in demand for normal goods price falls, quantity decreases
Market: TV Manufacturing American TV production closes its manufacturing plant
Supply shifts left because of decrease in number of producers in the market price increases, quantity falls
Market: Any Inferior Good American’s income rises 3 months is a row
Demand decreases because as incomes rise, there is a decrease in demand for inferior goods price falls, quantity falls