1. Chapter 21 https://www.youtube.com/watch?v=RP0j3Lnlazs
Supply and Demand
Chapter 21

2. Demand
Chapter 21 Sections 1 and 2

3. Demand
Demand- desire, willingness, and ability to buy a good or service
Demand Curve- shows the amount bought at all prices (Goes down)
Law of Demand- people are willing to buy less if the price is high and more if the price is low
Graphing Notes:
Quantity X-axis
Price Y-axis
Each point on the graph shows how many bought or sold at that price

5. Change in Demand When demand is down people buy less at all prices
Demand curve shifts to the left
When demand is up, people buy more at all prices
Demand curve shifts to the right
Graph Drink Machine Example
Do Law of Demand & Changes in Demand Worksheets 1 2 3

6. Supply
Chapter 21 Section 3

7. Supply Supply- quantities of a good or service that producers sell
Supply Curve- shows the amount of a product producers are willing to supply at all prices (Goes up)
Law of Supply- suppliers will offer more if the price is high and less if the price is low

9. Changes in Supply When supply is down sellers have less at all prices
Supply curve shifts to the left
When supply is up sellers have more at all prices
Supply curve shifts to the right
Do Law of Supply & Changes in Supply Worksheets

10. Supply and Demand
Chapter 21 Section 4

11. Price Adjustment Process
Supply and Demand
Graphing Notes:
-Quantity always on X-axis
-Price always on Y-axis
Price Adjustment Process
Price
Quantity Demanded
Quantity Supplied
$50
100
275
$40
150
225
$30
180
$20
230
105
$10
300 55 $5
400 30

12. Equilibrium Where supply and demand curves intersect is equilibrium
Equilibrium Price- price at which the amount producers supply is equal to the amount consumers demand
Ex. Equilibrium price for the video game is $30

13. Surplus Surplus- amount by which the supply is more than the demand
Surplus signals that the price is too high and there is not enough demand for the product– sellers will have to lower prices to sell products
Ex. If the video game is $40 sellers will supply 225 but buyers will buy 150– a surplus of 75

14. Shortage Shortage- amount by which the demand is more then the supply
Shortage signals that the price is too low and too many people demand the product– prices will rise
Ex. If the video game is $20 sellers will supply 105 but buyers will buy 230– a shortage of 125