1. Supply and Demand
Chapter 1.4

2. CHAPTER 1.4: SUPPLY & DEMAND
Goals:
Describe supply and demand orally and with graphs.
Discuss how prices of products and services affect supply and demand
Chapter 1

3. Producers establish Supply
Market Economy
Consumers set Demand
Producers establish Supply

4. Market Economy Consumer: buys and uses goods and services.
Decides what, where, and from whom to buy
AND at what price.
Producer: determines what products and services will be available for sale.
What needs & wants they will satisfy
What prices they want to receive.

5. Supply & demand
Supply: the quantity of a good or service that businesses or producers are willing and able to provide.
Demand: the quantity of a good or service that consumers are willing and able to buy.

6. Supply and demand

7. Supply & demand Factors Influencing Supply Natural Disasters
Decrease in Supply
Number of Competitors:
Large # = Increase in Supply
Small # = Decrease in Supply
Chapter 1

8. Supply & demand Factors Influencing Demand Seasons Substitute products
If customers can switch easily from one product to the other = Demand Low
If there are no substitute products = Demand High

9. DETERMINING PRICE
Market Price: the point where supply and demand are equal (also known as Break-Even Point)
Chapter 1

10. CHAPTER 1.4: SUPPLY & DEMAND
Goals:
Describe supply and demand orally and with graphs.
Discuss how prices of products and services affect supply and demand.
Chapter 1

11. END OF CHAPTER 1!