Featuring Supply and Demand

The Law of supply states that

producers/suppliers are usually willing

and able to produce/supply more of a

good or service as the price goes up.

The Law of supply states that

producers/suppliers are usually willing

and able to produce/supply more of a

good or service as the price goes up.

How is the Law of Supply different from how you think as a consumer?

PriceSupplierPays forEachT-shirt

Quantity the amount the supplier makes

7

6

5

4

3

2

1

00 25 50 75 100 125 150 175 200

The supplier is willing to make 175 t-shirts. The t-shirts cost the supplier $4 each

Supply curve (S1)

The cost per t-shirt

increases for the supplier

from $4 to $6 per T-shirt .

The supplier is now only

willing to make125 t-shirts

Supply curve (S2)

Note the changes that took place on the supply curve.

When the t-shirts cost the supplier $4 the supplier was willing to make more t-shirts

When the cost of the t-shirts increased to $6 the supplier was not willing or able to make as many t-shirts.

In which direction right or left did the supply curve go to show a decrease in the supply of t-shirts?

7

6

5

4

3

2

1

00 25 50 75 100 125 150 175 200

Supply curve (S1)

Supply curve (S2)

When there is a decrease the S2 curve will be placed to the left of the S1 curve

The Law of Demand states That consumers are willing and able to buy more of a good or service as the price goes down

How is the Law of Demand (What consumers want) different then the Law of Supply (what producers want)? If you don’t know, go back and read

bothlaws. Take 2 aspirins and call me in themorning.

40

35

30

25

20

15

10

5

00

Price PerT-shirt

5 10 15 20 25 30 35 40 45 50

Number of t-shirts purchased

D1

D2

The Demand for T-shirts decreases as the price went up from $20 to $25

The Demand for T-shirts increased. Consumers were willing to buy more t-shirts (30) @ $20.

Analyze slide #9 . Note the changes that took place on the

Demand curve. When the t-shirts cost the consumer $20

the consumer was willing to purchase more t-shirts

When the cost of the t-shirts increased to $25 the consumer was not willing or able to purchsae as many t-shirts.

In which direction right or left did the demand curve go to show a decrease in the demand of t-shirts?

5 10 15 20 25 30 35 40 45 50

Number of t-shirts purchased

D1

D2

When there is a decrease the D2 curve will be placed to the left of the D1 curve

As you listened to the song Irreplaceable what happened to the demand for her current boyfriend?

Was there an increase or decrease? Take the time to create demands (D1, D2)

which reflect the demand for current boyfriend.

Was there any indication that there was an increase or decrease in supply of boyfriends?

Take the time to create supply (S1,S2) which reflects the supply of future boyfriends.