Bellringer—Get out a clean sheet of paper and number Title it: “Notebook and Determinants of Demand Quiz” Each partner pair should retrieve the following from the back of the room. You have one minute after the bell rings to be in your seat with the materials. 1 small whiteboard 1 black dry erase marker 1 color (other than black) dry erase marker Sock eraser Put these under your desk.

EQ: Lesson 9 and 10 What is the difference between a change in demand and a change in quantity demanded change in supply and a change in quantity supplied? Be able to graphically apply the determinates of demand and supply. Agenda: 1. Bellringer—Notebook and Determinants of Demand Quiz 2. Review Demand Determinants 3. Lecture—Supply 4. Practice Problems—Supply

—list the determinants of demand

Price As price increases… Supply Quantity supplied increases Price As price falls… Supply Quantity supplied falls Supply—amount of goods for sale According to the law of supply, ceteris paribus, suppliers will offer more of a good at a higher price.

Table lists the quantities that suppliers will sell at various prices. $.501,000 Price per slice of pizzaSlices supplied per day Supply Schedule $1.001,500 $1.502,000 $2.002,500 $2.503,000 $3.003,500

A graph of the supply schedule Supply Curve Price (in dollars) Output (slices per day) Supply

Change in PRICE changes quantity supplied Movement along the curve Change in SUPPLY shifts the curve, caused by a change in the determinants of supply. AGAIN—shift to the right is an increase, shift to the left is a decrease Quantity Supplied (bushels per week) Price (per bushel) P Q S1S1 S2S2 S3S

$ Price of Pizza Quantity Supplied of Pizza 0 Decrease in supply An increase in the price of cheese S1S1 S2S2

Businesses will switch production to whichever good is more profitable If the market price of a similar good increases, supply will decrease. If the market price of a similar good decreases, supply will increase.

$ Price of Pizza Quantity Supplied of Pizza 0 Increase in supply S1S1 S2S2 Market price of Pizzones decreases

$ Price of Pizza Quantity Supplied of Pizza 0 Increase in supply The U.S. Government requires all school cafeterias to offer pizza at breakfast and lunch S1S1 S2S2

$ Price of Pizza Quantity Supplied of Pizza 0 Increase in supply New Oven speeds up the pizza making process S1S1 S2S2

$ Price of Pizza Quantity Supplied of Pizza 0 Decrease in supply The market price of pizza is expected to increase on Saturday. S1S1 S2S2

$ Price of Pizza Quantity Supplied of Pizza 0 Decrease in supply Pizza Hut goes out of business S1S1 S2S2

With a partner, draw a supply curve on the whiteboard. Title it “Supply of Foreign and Domestic Cars” Make sure that your graph has the Price and Quantity axes properly labeled and one curve labeled S1. You do not need numbers on the graph.

Draw original in black. Draw the new curve for each problem. There are 2 no SUPPLY SHIFT. They are demand shifts. Show them. Auto workers’ union agrees to wage cuts 1. New robot technology increases efficiency 2. National income rises 2% 3. Nationwide auto strike began at midnight 4. New import quotas reduce foreign car imports 5. Cost of steel rises 6. Auto producer goes bankrupt; Closes operation 7. Buyers reject new models

Draw a demand and supply graph for a product. Show an increase in supply in one color and a decrease in supply in another color. State which color is which out to the side. Give an example of what would cause the increase and what would cause the decrease. List and briefly explain the 6 determinants of supply. State the difference b/wn a change in supply and QS. Due Wednesday

What is the difference between a change in quantity supplied and supply? List the 6 determinants of supply. Quick quiz over the determinants of supply tomorrow.

Points 1-3—1. Draw the graph with both demand and supply curves. Both axes should be labeled correctly. 2. Draw an increase in supply. Label it S1. 3. Draw a decrease in supply label it S2. 4. The government passes the new Farm Bill. In it, they increase subsidies to farmers. 5. There is a new potato reaper that has been invented. 6. The cost of fertilizer has increased. (Assume that potato farmers use fertilizer.) 7. New diet becomes popular that bans carbs. Potatoes are carbs. 8. Government bans GMOs usage by farmers. GMO=genetically modified organisms. (P.S. GMOs increase crop yields.) 9. What happens to the equilibrium price when supply increases? 10. What happens to the equilibrium quantity when supply increases? 11. What happens to the equilibrium price when supply decreases? 12. What happens to the equilibrium quantity when supply decreases?

1. Get into a group of 4, retrieve 2 posters and 2 colored markers and a black. Think of 1 product. 2. Create two posters—one supply and one demand 3. Supply poster—one original curve—S, one increase—S1, one decrease S2 4. Demand poster—one original curve—D, one increase—D1, one decrease D2 5. Think of 5 different scenarios that would change demand for your product. One for each determinate. Think of one scenario that would not change demand. Write them down on a sheet of paper. 6. Think of 7 different scenarios that would change supply—one for each and one that wouldn’t shift. Write them down on a sheet of paper. Roles—1. Leader—overseer, helps where needed, 1 person draws the graphs, 2 people think of scenarios