The document outlines activities for a tutorial on supply and demand. Activity 1 instructs pairs of students to draw and explain supply and demand diagrams showing equilibrium, excess supply, and excess demand using an example product. Activity 2 requires groups to answer questions about the effect of increased coffee shop demand using an equilibrium analysis and materials from a case study. Activity 3 provides practice questions for groups to analyze how equilibrium price and quantity would change given scenarios involving changes in costs, technology, demand or other factors for various chocolate and ice cream products.

1. Global Context of
Modern Business
Tutorial 9
Supply and demand
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2. Activity 1
• Work in pairs
– Using a product of your choice (e.g. Housing,
computers etc.) as an example
• Draw a supply and demand diagram showing
equilibrium price and quantity. Do the same for
excess supply and excess demand. Show your plan
to your tutor and the rest of your group members
and try to explain them excess supply and
demand in your own words
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3. Activity 2
• Read Mini-case ‘Rise and rise of the UK coffee bar
market’ p.54, in Wetherly and Otter (2011)
– With your group, proceed to answer the following
questions:
• Using equilibrium analysis, show the effect of the increase
in demand for drinking coffee in branded coffee shops
available and the prices of coffee.
• What does the evidence that sales of coffee in branded
coffee shops are not declining despite the recession tell us
about the nature of the demand for this type of coffee?
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4. Activity 3
• Group Competition with practice
questions: With your group read and
review the following questions:
– New research has just been published
saying that chocolate causes cancer. What
would happen to equilibrium price and
quantity supplied in the market for
Thornton's chocolate? Draw the graph that
illustrates your answer.
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5. Activity 3
–Presume that the price of Mars
chocolate increases. What would
happen to equilibrium price and
quantity in the market for Cadbury
chocolate? Draw the graph that
illustrates your answer.
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6. Activity 3
• Suppose that the price of sugar increases.
What would happen to equilibrium price and
quantity in the market for Thornton's
chocolate? Draw the graph that illustrates
your answer.
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7. Activity 3
• A company has just invented a better and
more advanced machine for mixing the
ingredients to make chocolate bars. What
would happen to equilibrium price and
quantity in the market for Thornton's
chocolate? Be able to draw the graph that
illustrates your answer.
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8. Activity 3
• A recent survey has just shown that chocolate is
Britain’s favourite ice-cream flavour. For each of the
following, show the possible effects on demand,
supply, or both as well as equilibrium price and
quantity of chocolate ice cream.
– A severe drought in the Northwest causes dairy farmers to reduce
the number of milk-producing cattle in their herds by a third. These
dairy farmers supply cream that is used to manufacture chocolate ice
cream.
– A new report by the British Medical Association reveals that
chocolate does, in fact, have significant health benefits.
– The discovery of cheaper synthetic vanilla flavouring lowers the price
of vanilla ice cream.
– New technology for mixing and freezing ice cream lowers
manufacturers’ costs of producing chocolate ice cream.
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