1. Unit 2: Supply & Demand
Modules 5-7

2. Module 5 Key Terms & Review
Competitive market
Movement along the demand curve
Substitutes
Complements
Normal good
Inferior good 1. 2. 3. 4. 5.

3. Types of Markets What is a market?
Market structure is studied in microeconomics
Perfect competition
Monopolistic competition
Oligopoly
Monopoly

4. What is Demand?
The willingness and ability to purchase a good or service at a given price
Law of Demand

5. Change/Shift in Demand
Something has changed other than the price that alters buyers’ willingness to purchase a product

6. Positional Goods - Big Bang Theory

7. Diminishing Marginal Utility
Cheerios? Yes!
Scrunchies? No!

8. Module 6 Key Terms & Review
Movement along the supply curve 1. 2. 3. 4. 5.

9. What is Supply?
The amount of a product that producers are willing to see at a given price
Law of Supply

10. Change/Shift in Supply
Something has changed other than the price that alters producers’ willingness to sell a product

11. Module 7 Key Terms & Review
Equilibrium
Surplus
Shortage 1. 2. 3. 4. 5.

12. When Supply Met Demand: A Love Story

13. Mixed Signals Consumers want Producers want Equilibrium price
What happens when a product is priced at something other than the equilibrium price?

14. Shifts in Supply & Demand
Shifts in supply and/or demand change the equilibrium price & quantity
Change in demand v. quantity demanded
Change in supply v. quantity supplied

15. Unit 2 Review (pg. 100) 1. 2. 3. 4. 5. 6. 7. 8. 9.

16. Prices reflect society’s values

17. Supply & Demand FRQ do’s and don’ts
Tom does not label his graphs. Tom doesn’t know shift. Tom also doesn’t know about inflation…
… and he’s a huge crybaby.
Peyton always labels his graphs. Peyton knows his shift. Good job Peyton!

18. Supply & Demand Review
When you react to a change in price, that is called a change in Qd / Qs
What causes the price of a product to change?
Changes in supply or demand (curve shifts)
Changes in the situation are the CAUSE, changes in the price and quantity bought and sold are the EFFECT
A shift in demand has led to a higher price and a higher Qs & Qd