We will be using Cornell Note Taking Format Today! Smile and “Own the Day! Take one step at a time to Success in Economics class! Unit Two: Learning Objectives: North Clackamas School District Social Studies Priority Standards: • HS.51 (A): Explain how supply and demand represents economic activity and describe the factors that cause them to shift. Lesson 2-4: Daily Learning Target I Can define and explain in writing the following key Economic concepts: Law of Supply Supply Curve Elastic and Inelastic Supply Unit Two Assessment: M-4/18 and TU- 4/19 (You can use a notecard) For Problems 6-15 answer: INCREASE OR DECREASE 6. An increase in income results in a(an) _____________ in demand for steak. increase 7. An increase in income results in a(an) _____________in demand for spam. decrease 8. A decrease in the number of buyers or consumers in the market will ___________ decrease demand for all goods. 9. A decrease in the price of a complementary good results in a(an) _____________ in demand for another complementary good. increase 10. An increase in the price of substitute good results in a(an)___________ increase in demand for another substitute good. 11. An increase in taste for an item results in a(an) ___________ increase in demand. 12. A increase in the price of Diet Coke results in a(an) __________in demand increase for an Albertson’s brand of diet soda. 13. An expectation that the price of a commodity will be higher in the future than it is now will ____________ increase its current demand. 14. An increase in the number of buyers or consumers in the market will increase “D” for inferior goods. increase “D” for normal goods and ________ _________ increase in “D”. 15. If the price of iPad is expected to rise, there will be a(an) _________ Microsoft’s new tablet, The Surface Law of Supply I want a clean diaper Your mom wanted peace and quiet. Law of Supply Take notes on the slides with “Binky (the stinky) Baby” Butter Bread Look carefully at this graph. How does price influence supply? Why do suppliers love high prices? Law of Supply The Law of Supply is the tendency of suppliers to offer more of a good at higher prices. Sellers love high prices. The Law of Supply is the opposite of the Law of Demand. Let’s Make More!! S P1 QS1 Take it. We are losing money. S P1 QS1 . S I’m saving money at the lower price. I normally eat one, but at this low price, I’m Having two. Why is the Law of Supply True? Supply increases as price rises because either existing firms will produce more to make greater profits…OR…. new firms will enter the market to take advantage of the high prices. Sellers love to make profits. Suppliers don’t sell Disco anymore. There just isn’t any money in it. They go where the money is. A Supply Curve A supply curve is a graphic representation showing the tendency of suppliers to supply more at higher prices. A supply curve will always rise left to right. Suppliers supply more at higher prices. Notice how the supply curve rises left to right. Supply moves in the direction of price. Shot Glass “Take Dat Wit Chew” Supplied 0 1000 2000 3000 4000 5000 Supply Schedule & Curves A Supply Schedule displays the quantity of a product supplied at each price Price Bottles Supplied 2.00 1.75 1.50 1.25 1.00 .75 .50 11.6 11.5 11.2 10.7 10 9.1 8 SUPPLY SCHEDULE CORN P QS $1 5 2 20 3 35 4 50 5 60 SUPPLY CURVE S P $5 $4 $3 $2 $1 5 20 35 50 60 QS Supply Schedule & Curves Use the following supply schedule for corn to create a supply curve. Price Per Ton Quantity Supplied $100 $150 $200 $250 $300 $350 $400 50 75 100 125 150 175 200 Your curve should basically look like this: As price goes up, QS goes up. “Demand Quiz” Complete the “Demand Quiz” (1-50) Now!!! THE QUIZ IS OPEN NOTES WHEN YOU ARE FINISHED…. Work on your Demand Review Exit Ticket 2-3 (Summative40 pts.)This is a review assignment that will take you part of two periods to complete. Pick Up Exit Ticket 2-3 (Summative Assignment): We will finish this EXIT TICKET next class!