1. CHAPTER SIX PRICES

2. Equilibrium When demand meets supply Demand greater than supply – shortage Supply greater than demand - surplus

3. Government interference with prices Price ceilings ◦Rent control Price floors ◦Minimum wage

4. Prices Read 137-140 What is the argument for and against rent control? With partner, answer number 1 + 2 on p. 138

5. Prices What is the argument for and against minimum wage? With partner, answer number 1 + 2 on p. 139

6. Assessment With table partner, complete Number 11 on page 140

7. Question of the Day What are the two ways in which the government controls prices? Please provide an example of each.

8. Changes in Market Equilibrium Moving toward Equilibrium - Price and quantity will move toward equilibrium levels Two Factors that can lead to Disequilibrium -Shift in supply curve -Shift in demand curve

9. An Increase in Supply ◦A Changing Market that increases supply  Inventory will pile up (surplus)  Suppliers will reduce prices to clear out the surplus  With the lower price, demand will increase and the market will find equilibrium

10. A Decrease in Supply ◦As supply decreases, suppliers will raise their prices ◦Demand will fall ◦With the lower price, demand will increase and the market will find equilibrium

11. An Increase in Demand ◦ Supply... ◦ Price...

12. A Decrease in Demand ◦...

13. Complete Number 10 on page 147

14. Vocabulary Supply shock Rationing Black market

15. Question of the Day In your notebook: ◦Design a supply/demand curve that illustrates a change in equilibrium based on an increase in supply.

16. Review Review ◦How does the government affect supply? (3) ◦How does the government affect prices? (2)

17. Chapter 6: Pictionary Time Equilibrium Disequilibrium Shortage Surplus Supply shock Rationing Black Market Price ceiling Rent control Price floor Minimum wage Inventory Fad

18. Question of the day. What could be negative consequences to: ◦A. Rent control ◦B. Minimum wage

19. Sketch: ◦Advantages of Price-based system ◦Shortage and Surplus ◦P. 155

20. Pop Quiz

21. Your Group Project (1-3 members) Design your own business Select a name and product Graph how your business would respond to:  Supply shock  Increase in supply  Decrease in demand  Increase in demand Explain the reasons for the above Be realistic and be neat! Due at the end of class on Friday