1. In your Interactive Notebook: Unit. Day 6. 2 & 6
In your Interactive Notebook: Unit.Day 6.2 & 6.3 Supply, Demand, and Price
ON YOUR DESK: 1)
2) Interactive NB
3) (Completed) Study guide
WARM UP
Name and describe three supreme court cases and the ruling in each case.
Today’s Agenda
Warm up & review
Supply & Demand Activities & Notes
Review Packets
Today’s OBJECTIVE(S): WRITE DOWN:
I can define the law of supply and demand
I can graph supply and demand to find an equilibrium price

2. Updates & Deadlines: (use assignment log!!!)
Daily: FINAL EXAM PACKET
12/19: Supply & Demand Practice Worksheet
12/20: QUEST; Division of labor, outsourcing, etc.
1/6: Economic Systems Skits
1/7: Free Trade & Globalization; DEADLINE FOR REVIEW PACKETS & LATE WORK
1/8, 1/9, 1/10: APPLIED REVIEW
EXTRA CREDIT: ACES Paragraph: How do credit scores affect interest rates?
FINAL EXAMS:
1/13: 2nd Period
1/14: 4th Period
1/15: 1st Period
1/26: 3rd Period

3. Adam Smith Wrote The Wealth of Nations
Said that governments should stay out of economics and leave choices to individuals

4. Laissez-Faire Term meaning “let it be/go”
Government does not interfere in the economic system

5. Theory of Supply and Demand
Argues that free market COMPETITION is the best way to set prices
Let suppliers compete for the highest profit
Let consumers compete for the lowest price
Everything will work itself out

6. Capitalism Argues that people are motivated by: The “profit motive”
Self-interest
Personal profit
The “profit motive”

7. The Invisible Hand
Smith believes that the forces of supply and demand work as an “invisible hand” to guide the market
People don’t control it, but…
It is based on human nature:
We want to maximize profits
We want cheap stuff

8. GRAPH Analysis
Supply & Demand

9. Key Vocabulary for today:
Supply
Demand
Price
Surplus
Shortage
Productivity
Profit motive
Equilibrium price

10. Supply and Demand

11. Question What will happen to price if I have more candies? Less?
What will happen to price if I can sell a lot of something?

12. Supply & Demand Jars
Use the arrows to indicate what will happen to supply, demand, or price in each example.

13. Demand Desire, willingness, AND ability to buy a good or service
ALL 3 are important

14. Law of Demand
People are usually willing to buy more of a product at a low price than a high price

15. Supply
The quantities of goods or services that producers are willing to sell
Also have to consider scarcity of resources

16. Law of Supply
Suppliers will provide more goods if they can charge a higher price for them (and less goods if they are selling for less)

17. Price
The amount of money paid for a good or service

18. Supply and Demand Curve

19. Practice Activity Complete the practice sheet individually
Check work with me as you go
Work on Review Packet

20. Supply and Demand Curve

21. Surplus, Shortage, Equilibrium
Surplus Supply is greater than demand (price too high)
Shortage Demand is greater than supply (price too low)
Equilibrium price Neither surplus nor shortage (price just right)

22. What can affect demand?

23. Demand influenced by 4 factors:
Changes in population
Changes in income
Changes in tastes
Changes in expectations
Changes in supply / availability
Related goods (substitutes & compliments)

24. expectations
If you know the price is going to drop later, you will wait to buy
If you know the price will go up, you will buy now.

25. Utility
The pleasure, usefulness, or satisfaction that we get from using a product

26. Marginal Utility
The amount of satisfaction that we get from each additional unit we consume
Tends to go down the more we consume
The more we have of something, the less we value it

27. Influences on supply Cost of resources Productivity Technology
Government policy
Taxes
Expectations
Number of suppliers
competition

28. HOMEWORK
COMPLETE THE WORK ON BACK OF YOUR NOTE ORGANIZER

29. Quick Quiz
1. This is caused by having limited resources and unlimited wants.
2. This term refers to what a person loses the chance to do when they make a trade off choice.
A. Trade-off
B. Scarcity
C .Demand
D. Supply
E. Opportunity Cost
F.Equilibrium Price

30. Quiz - continued
3. The law of ________ says that people are usually willing to buy ______ of a product when the price is lower. 4. The law of _______ says that producers are usually willing to sell _______ of a product when the price is _______.

31. Quiz
5. What happens to the price of carrots if Carrot Cake becomes the world’s most popular desert?

32. When demand is greater than supply.
When supply equals demand.
A store is likely to offer a sale on a product when it has this.
Surplus
Shortage
Equilibrium
Utility
Price

33. Quick Quiz – OPEN NOTE
B - This is caused by having limited resources and unlimited wants.
E - This term refers to what a person loses the chance to do when they make a trade off choice.
Trade-off
B -- Scarcity
Demand
Supply
E -- Opportunity Cost
Equilibrium Price

34. Quiz - continued
2. The law of DEMAND says that people are usually willing to buy MORE of a product when the price is lower. 3. The law of SUPPLY says that producers are usually willing to sell more of a product when the price is HIGH.

35. Quiz
4. What happens to the price of carrots if Carrot Cake becomes the world’s most popular desert? IT GOES up…

36. B - When demand is greater than supply.
C - When supply equals demand.
A - A store is likely to offer a sale on a product when it has this.
Surplus
Shortage
Equilibrium
Utility
Price