Do NowWrite an example of opportunity cost you madethis weekend. What did you give up? What didyou gain? What was the limited resource?
Agenda1. DO NOW2. Review3. Supply and Demand Notes4. Supply and Demand Cartoon
Competencies/ Objectives• Students will be able to identify the effects that price has on supply and demand.• Students will create a cartoon that demonstrates the effect natural disasters/ holiday demands have on the price of products.
DemandHow much of a product orservice is desired by others?The quantity demanded isthe amount of a productpeople are willing to buy at acertain price.The relationship betweenprice and quantity demandedis known as the demandrelationship.
SupplySupply means how much themarket can offer.Quantity Supplied isdetermined by how muchproducers are will to make atthe given price.The supply relationship refersto how much a good orservice is supplied based onprice.
The Law of DemandThe higher the price of thegood the less people willdemand that good.Why?As the price goes up so doesthe opportunity cost ofbuying that good.
Law of SupplyThe higher the price thehigher the quantity supplied.Why?Producers want to sell asmuch as they can at as high ofa price as they can in order tomake more money.
Supply and DemandRelationshipEquilibrium- When supply anddemand are equal.The amount of goods beingsupplied is the same as theamount of goods beingdemanded! Everyone is happy :)Equilibrium only exists intheory.That is why the prices of goodsand services are alwayschanging.
DisequilibriumExcess SupplyIf the prices is too high,excess supply will be created.Too much of a good or serviceis offered and not enoughpeople are consuming it.
DisequilibriumExcess DemandThe price is set below whatpeople are willing to pay forit.Too many consumers wantthe good while producers arenot making enough of it.