The document provides an overview of the basic economic concepts of supply and demand. It explains that supply is represented by an upward sloping supply curve, as higher prices lead to greater production. Demand is shown by a downward sloping demand curve, as consumers will buy more of a good at lower prices. The equilibrium point is where supply and demand are equal, which establishes the market price. The document also discusses elastic versus inelastic demand and how responsive demand is to price changes.

1. ECONOMICS The Supply & Demand Model Presented by: Daniel L. Smith ED 205 TR 10-11:15

2. The Supply & Demand Model Supply Demand Elastic Demand Inelastic Demand Equilibrium Quit

3. Supply The Law of Supply states that quantity supplied is related to the price of a good or service. Therefore, the higher the price of a good or service the more a producer will produce of it making the supply curve upward sloping. Supply Curve Quit

4. Demand The Law of Demand and the demand curve represents the amount of good and services that buyers are willing to purchase at various prices, assuming all other factors are constant. As prices decrease of a good consumers buy more making the demand curve downward sloping. Demand Curve Quit

5. Elastic Demand Elastic Demand is the percentage change in one variable by the percentage change in another variable. By this being done the demand for a good or service is more elastic meaning that there ARE substitutes allowing consumers to pay less for the goods. Elastic Demand Quit

6. Inelastic Demand The Inelastic Demand curve is when the quantity demanded does NOT change much with a change in price. Therefore, some goods and services in which no substitutes are available are generally inelastic. Inelastic Demand Quit

7. Equilibrium The Equilibrium of Supply and Demand is where the quantity supplied equals the quantity demanded. At the Equilibrium there is no tendency to change. The Equilibrium point is the intersection of Supply and Demand. Equilibrium of Supply & Demand Quit

8. Try This!!! Go to the web address listed below to test your knowledge of the concepts when it comes to the Demand & Supply. http://ecedweb.unomaha.edu/Dem_Sup/econqui2.htm Quit

9. Supply & Demand Curve As we have noticed, by examining the affects of both the supply curve and the demand curve, they are both related and or dependent upon each other. If the supply of a good or service were to increase or decrease it would affect the equilibrium point, which would in turn then affect the price of the good or service. Quit

10. Supply & Demand Video Click on the link below to view a video that will explain to you the reasons for the Supply and Demand curves and why they are shaped the way they are. It will also discuss the affects of shifts on the curves which we will cover in the next unit so pay close attention!!! http:// www.youtube.com/watch?v =qdOqAWo8vFw Quit

11. How Demand & Supply Effects One Another With the ability of the demand for a partical good such as salt to change, the price may also change. Therefore, by consumers decreasing their consumption of salt the producers will in turn decrease the supply of it. This makes salt a product that has an inelastic demand. Quit

12. Daniel L. Smith I am a Group Social Studies Major at Grand Valley State University. My minor is in Economics and I am the assistant basketball coach at Allendale High School. Email me @ [email_address] Quit

13. Concept Map of the Supply and Demand Model This is the way That we developed Our supply and Demand Model. Quit

14. Resources Video of the Supply & Demand Model http://www.youtube.com/watch?v=qdOqAWo8vFw Quiz, “Exploring Supply & Demand http://ecedweb.unomaha.edu/Dem_Sup/econqui2.htm Quit