Shifting Supply and Demand

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Presentation transcript:

Shifting Supply and Demand Examining Graphs

Equilibrium Equilibrium Price is the price at which the quantity demanded and the quantity supplied are equal. Market Equilibrium occurs when the quantity demanded and the quantity supplied at a particular price are equal.

Surplus v. Shortage A surplus is the result of quantity supplied being greater than quantity demanded. A shortage is the result of quantity demanded being greater than quantity supplied.

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Supply and Demand Graph Equilibrium price. Price change-Shortage/Surplus In this supply and demand graph, what likely happens if the cost of parts for automobile products decreases? The supply curve for automobiles shifts to the right. happens when a higher tax is placed on sales of cigarettes? The demand curve shifts to the left.

What is happening to the Demand curve? Pg113 – Demand Shift *Farmers -Shoppers learned that cans of cooked tomatoes are spoiled. *Substitutes for product have become cheaper What is happening to the Demand curve? What happened to Equilibrium Price? What could cause this Demand shift?

What is happening to the Supply curve? Pg. 151 – Supply shift -If quantity = swimsuits, -when the number of swimsuit makers leave the industry increases. -when the input cost of the product increases. -higher tax placed on swimsuits What is happening to the Supply curve? What happened to the Equilibrium Price? What could cause this Supply shift?

What is happening to the Supply curve? -number of producers increase. More sellers -technology increases supply -its cheaper to produce product: input costs What is happening to the Supply curve? What happened to Equilibrium Price? What could cause this Supply shift?

https://www.youtube.com/watch?v=V0tIOqU7m-c

Creation Station Create your own Supply and Demand Graphs. One graph should represent a Demand shift and the other Graph should represent a Supply shift. Explain the causes of each shift of your graph. Label your Equilibrium Prices. Tell me what happens to your Equilibrium Price after the shift in Demand and Supply. Your Graph should have color and illustrations.