2. The Law of Supply
When people are willing to buy at a high price the
producer will make more items
The Law also says the lower the price people are
willing to pay, the fewer items the producer will be
willing to make
3. Supply Curve
Incentive of Greater Profits: The higher the price of a
good the greater the incentive is for a producer to
produce more
Each point on a supply curve signifies that a
producer will supply a certain quantity at each price
4. Determinants of Supply
Price of Inputs: Price of raw materials and wages
Number of firms in the Industry, number of
businesses competing for your business
Taxes, more taxes means the cost of production goes
up
Technology, improvement in technology means
producing goods cheaper
5. Law of Diminishing Returns
Adding units of one factor of production (Labor) to
other factors of production (equipment) after some
point out put or efficiency will actually decrease
6. Putting Supply and Demand Together
Equilibrium Price- The price at which the amount
supplied by producers is equal to the amount
consumers are willing to buy
7. 4 Square
Shortage- When consumers buy more than
producers are willing to make
Surplus-When producers supply more than the
consumers are willing to buy
Price Ceilings- A legal maximum price that may be
charged for a good or service
Price Floor- a Legal minimum price that may be
charged for a good or service
8. Political Cartoon
Convert a news article into a political cartoon, or
cartoon strip.
Use construction paper and markers to draw cartoon
Make sure there is dialogue to explain article
