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Salaries and Supply and Demand
- 1. WWhheenn SSuuppppllyy MMeeeettss DDeemmaanndd
- 2. CS Prices of Apples The floor S federal governments price is set above the market price. As a result. Sellers will be willing to sell more and buyers will be willing to buy less. This results in a surplus of apples. 50 100 150 200 250 300 350 400 450 500 Quantity in tons of Apples .10 .15 .20 .25 .30 .35 .40 .45 .50 D D1 P Q PC Shortage PF Surplus P1 Q1 The federal governments price ceiling is set below the market price. As a result, buyers demand more at the lower price, and sellers are willing to sell less at the lower price. This results in a shortage of apples.
- 3. Assume you go into a store and buy a pack of delicious French Onion flavored Sun Chips. The chips cost you $1.00. You love them so much you would have been willing to $2.00. The difference between what you paid and what you would have been willing to pay is consumer surplus (CS). At this price you got a good deal! Why is consumer surplus important? When markets create consumer surplus, many consumers buy the good for less than they would be willing to pay. Consumers like this because they are getting a deal! Producers dislike it because they know some people would be willing to pay more. Ex. Shoes at Nordstrom's Buying a used car
- 4. *If the price consumers pay increases, consumer ssuurrpplluuss ddeeccrreeaasseess .45 .40 .35 .30 .25 .20 .15 50 100 150 200 250 P Q (in millions) D S S Why is consumer surplus important? When markets create consumer surplus, many consumers buy the good for less than they would be willing to pay. Consumers like this because they are getting a deal! Producers dislike it because they know some people would be willing to pay more. Ex. Shoes at Nordstroms Buying a used car
- 5. CS Prices of Apples S 50 100 150 200 250 300 350 400 450 500 Quantity in tons of Apples .10 .15 .20 .25 .30 .35 .40 .45 .50 D D1 P Q PC Shortage PF Surplus P1 Q1
- 6. NNooww yyoouu TTrryy…… UUssee tthhee iinnffoorrmmaattiioonn yyoouu jjuusstt lleeaarrnneedd ttoo sseeee hhooww ssuuppppllyy aanndd ddeemmaanndd wwoorrkkss wwiitthh gguummbbaallllss.. FFiirrsstt pplloott yyoouurr ggrraapphh ggiivveenn tthhee iinnffoorrmmaattiioonn.. ((11--77)) NNeexxtt aannsswweerr tthhee qquueessttiioonnss oonn yyoouurr wwoorrkksshheeeett.. ((AA--EE)) HHiigghheerr--OOrrddeerr TThhiinnkkiinngg QQuueessttiioonn:: FFiinnaallllyy,, ccrreeaattee yyoouurr oowwnn sscceennaarriioo.. IInn yyoouurr sscceennaarriioo,, eexxppllaaiinn tthhee aassppeeccttss ooff ddeemmaannddss aanndd pprriiccee fflloooorrss aanndd cceeiilliinnggss..
- 7. TTaakkee aa SSttaanndd!! SSoommee pprrooffeessssiioonnss hhaavvee hhuuggee ddiissccrreeppaanncciieess ooff ssaallaarriieess eevveenn tthhoouugghh tthheeyy ppeerrffoorrmm tthhee ssaammee jjoobb.. -Doctors -Lawyers -Authors IItt iiss yyoouurr jjoobb ttoo ddeecciiddee iiff tthhiiss iiss ffaaiirr.. YYoouu hhaavvee 1100--sseeccoonnddss ttoo cchhoooossee oonnee ooff tthhee ffoolllloowwiinngg ssttaanncceess aanndd ssttaanndd aatt yyoouurr nnuummbbeerr.. Yes, they deserve every penny. No, other professionals deserve the same. It depends.
- 8. HHoommeewwoorrkk AAssssiiggnnmmeenntt YYoouu hhaavvee bbeeeenn ppllaacceedd iinn oonnee ooff tthhee 55 ffoolllloowwiinngg ggrroouuppss:: •AAtthhlleetteess •MMoovviiee SSttaarrss •TTeelleevviissiioonn AAccttoorrss •CCoolllleeggee PPrrooffeessssoorr •CCEEOO YYoouu wwiillll:: 1)A salary discrepancy between at least two people of the same profession. 2)One source that defends their stance. 3) Write a 4-paragraph essay explaining why they have come to their conclusion.
- 9. TThhrraasshh iitt OOuutt • TTooddaayy yyoouu wwiillll ddeebbaattee yyoouurr ppoossiittiioonn wwiitthh ppeeooppllee rreesseeaarrcchhiinngg tthhee ssaammee pprrooffeessssiioonn!! • FFoorr tthhee nneexxtt 1100--MMiinnuutteess aanndd wwiillll wwoorrkk wwiitthh yyoouurr ppaarrttnneerrss ffrroomm tthhee pprreevviioouuss ddaayy.. DDiissccuussss wwhhaatt yyoouu lleeaarrnneedd ffrroomm yyoouurr rreesseeaarrcchh.. CCoommee uupp wwiitthh aarrgguummeennttss ttoo ddeeffeenndd yyoouurr ssttaannccee aanndd tthhiinnkk aabboouutt ppoossssiibbllee rreebbuuttttaallss.. • YYoouu wwiillll bbee ddeebbaattiinngg yyoouurr ttooppiicc wwiitthh yyoouurr oorriiggiinnaall ggrroouuppss…… Good Luck!
- 10. QQuueessttiioonnss HHooww ddoo tthhee llaawwss ooff ssuuppppllyy aanndd ddeemmaanndd aaffffeecctt tthhee ssaallaarriieess ooff tthheessee pprrooffeessssiioonnss?? WWhhaatt wwoouulldd aa pprriiccee cceeiilliinngg oorr pprriiccee fflloooorr ddoo ttoo ppeeooppllee eemmppllooyyeedd iinn tthheessee pprrooffeessssiioonnss?? HHooww ddoo ssaallaarryy ddiissccrreeppaanncciieess rreellaattee ttoo aa mmaarrkkeett eeccoonnoommyy?? AAnnaallyyzzee eeaacchh ddeebbaattee.. HHooww ddooeess tthhiiss rreellaattee ttoo tthhee ssuuppppllyy aanndd ddeemmaanndd ooff ggooooddss aanndd sseerrvviicceess?? HHooww ddooeess tthhee IInnvviissiibbllee HHaanndd ccoonnttrrooll ssaallaarriieess??