1. Supply and Demand Curves

2. Law of Demand and Demand Curve  Law of Demand= Relationship between the quantity demanded and price is inverse. (They move in opposite directions)  As price increases, quantity demanded decreases.  As Price decreases, quantity demanded increases. https://www.khanacademy.org/economics-finance- domain/microeconomics/supply-demand-equilibrium/demand-curve- tutorial/v/law-of-demand

3. Quantity Demanded and Demand  Change in “quantity demanded” causes movement along the same demand curve.  Change in demand causes the entire demand curve to shift to the right or left.  Right=Increase Change in Demand ↓  Left=Decrease

4. Determinants of Demand (Cause a shift in Demand Curve)  Change in population  Change in Income  Change in Taste/Preference  Substitute Goods  Complementary Goods

5. Elasticity of Demand  A rise or fall in the price of a good greatly affects the amount people are willing to buy.  What are some examples of goods that have an elastic demand?  Toilet Paper?  Hot Dogs?

6. Inelastic Demand  Price change doesn’t greatly affect quantity demanded.  Gas- no matter the price, people still need gas.  Electricity  Anything that is essential to every day life most generally is inelastic.

7. Law of Supply and Supply Curve  Law of supply= There is a direct relationship between price and quantity supplied.  Price rises=quantity supplied rises  Price falls=quantity supplied falls  Incentive of greater profits causes the production of more goods. (Increase in supply)  Supply curve- shows the quantity supplied at each possible price. https://www.khanacademy.org/economics-finance- domain/microeconomics/supply-demand-equilibrium/supply-curve- tutorial/v/law-of-supplyhttps://www.khanacademy.org/economics-finance- domain/microeconomics/supply-demand-equilibrium/supply-curve- tutorial/v/law-of-supply

8. Supply Curve  Change in “quantity supplied”- caused by a change in price and is shown as movement along the supply curve.  Change in supply- producers supply more or fewer goods at every possible price. (Shifts entire supply curve)  These shifts are cause by determinants of supply which are:  Price of Inputs/Cost of Production  Number of businesses in the industry  Taxes on businesses  Technology (better/faster production)

9. Change in “quantity supplied” vs change in Supply Both curves show an increase.

10. Supply and Demand Together  Equilibrium Price- quantity supplied by sellers is the same as quantity demanded by consumers.  Shortage- quantity supplied is less than the quantity demanded. (Not enough goods to satisfy wants/needs)  Surplus- quantity supplied exceeds quantity demanded. (Goods left over because demand wasn’t great enough)