1. Supply the other side of a market Reference 4.1-4.3

2. What kinds of goods and services are supplied? Where there is demand, there is supply.

3. SUPPLY THE WILLINGNESS AND ABILITY TO PRODUCE AND SELL A GOOD OR SERVICE. THE WILLINGNESS AND ABILITY TO PRODUCE AND SELL A GOOD OR SERVICE.

4. Law of Supply As the price of a good increases, the quantity supplied of that good increases. As the price of a good increases, the quantity supplied of that good increases. As the price of a good decreases, the quantity supplied of that good decreases. As the price of a good decreases, the quantity supplied of that good decreases. Does this sound familiar??? Does this sound familiar???

5. Compare the Law of Supply with the Law of Demand Discuss with your partner the similarities and differences of the two laws. Discuss with your partner the similarities and differences of the two laws. Law of Demand, an inverse relationship between price and quantity demanded. Law of Demand, an inverse relationship between price and quantity demanded. Law of Supply, a direct relationship between price and quantity supplied Law of Supply, a direct relationship between price and quantity supplied

6. Supply Schedules and Supply Curves Price Quantity Supplied $.401000 $.602000 $.803000 $1.004000 Typical supply curve: Upward Sloping—a direct relationship Apples

7. An exception to the Law of Supply: A Vertical Supply Curve Goods that can no longer be produced Goods that can no longer be produced –Stradivarius Violins –Art works –Antiques When there is no time to produce more. When there is no time to produce more. –Sold-out concert tickets

8. Consider 2 high schools NothingFancy H.S. NothingFancy H.S. –Students don’t get paid for A’s. BigBucks H.S. BigBucks H.S. –Students get paid $50.00 for each A. At which high school would you expect to see more A’s? How does your answer relate to the Law of Demand?

9. Supply Curves Shift Shift to the right Shift to the right –Producers will supply more of the good at all prices Shift to the Left Shift to the Left –Producers will supply less of the good at all prices.

10. Supply increase Supply decrease

11. Factors that Can Cause a Supply Curve to Shift Resource Prices Resource Prices Technology Technology Government Action Government Action –Taxes –Subsidies –Quotas Number of Sellers Number of Sellers Weather Weather

12. Resource Prices Resource Prices rise, producers will supply less Resource Prices rise, producers will supply less Resource Prices fall, producers will supply more Resource Prices fall, producers will supply more

13. Technology Advancement in technology (skills and knowledge relevant to production) Advancement in technology (skills and knowledge relevant to production) –lowers the cost of production –uses other resources more efficiently

14. Government Actions Taxes – Some can increase per-unit costs Taxes – Some can increase per-unit costs (left shift) Subsidies – Government payments for Subsidies – Government payments for certain actions. certain actions. (right shift) (right shift) Quotas – government restrictions on Quotas – government restrictions on production, especially imports production, especially imports (left shift) (left shift)

15. Number of Sellers. More sellers… shift supply curve to the... shift supply curve to the...right

16. Elastic supply = %change Qs > %change P Elastic supply = %change Qs > %change P Inelastic Supply = %change Qs < %change Inelastic Supply = %change Qs < %change price price Unit elastic Supply = %change Qs = %change Unit elastic Supply = %change Qs = %changeprice

17. Classwork: Read and answer the questions, Read and answer the questions, p. 100/101 p. 100/101 –“The Beatles” –“Taxes, Tariffs & America’s Great Depression” Complete Section Review, p. 103 Complete Section Review, p. 103#1-4 Homework: Homework: –P. 104-105 QToA #1-9

18. Emergency Homework Read and note Ch 4.2 p. 95-103 Read and note Ch 4.2 p. 95-103 Complete Section Review #1-7 Complete Section Review #1-7 –Question #1 is definitions. Instead of re- writing them, you may highlight them in your notes.