SUPPLY(Part 2)

CHAT REVIEW

You will be presented with 4 questions.

Turn to your “table buddy” and chat about the answers to these questions for 1-2 minutes each.

ONE.Why do you think

producers are willing to supply more goods at high prices than at low prices?

TWO. If a region experiences flooding,

what industries might be affected? What happens to

the amount of goods supplied by those

industries?

THREE.

When the price of “inputs” to production rise, producers supply fewer goods overall. Why do you think this true?

All the supplies & resources needed to

produce a finished good, including the equipment

and labor.

FOUR.Name as many inputs in

the production of this shoe as you can:

RECALL: SHIFTS IN SUPPLYONLY changes in price result in movement along the supply curve. Changes in other

factors can actually SHIFT the supply curve.

• Change in natural conditions !

• Change in technology !

• Change government policies !

• Price of a key input to production changes

PRACTICE QUESTION #1:Terry’s T-Shirt CO. decides to lower the price of T-Shirts by 1$. Which

graph below represents this situation?

S1

S2 P1P2

A. B.

PRACTICE QUESTION #2:

The price of fertilizer becomes more expensive. How does this

affect the supply curve for apples?P

(of a

pple

s)

QS (of apples)

PRACTICE QUESTION #3:

The government increases taxes on paper, an input in the production of books. How does

this affect the supply curve for books?

P (o

f boo

ks)

QS (of books)

PRACTICE QUESTION #4:The invention of the

cotton gin means that cotton pickers no longer have to

clean cotton by hand. How does this affect the supply curve for

cotton products?

P (o

f cot

ton

prod

ucts

)

QS (of cotton products)

CURRENT EVENTS: HOMEPLUS LEAVING KOREA?Read the following article, and draw a supply graph

that represents the situation. !

See if you can identify which factor is causing the shift.

CURRENT EVENTS: HOMEPLUS SCANDAL

Read the following article, and draw a demand graph that represents the situation.

!See if you can identify which factor is causing the shift.

POLL RESULTS:

•  Not reading carefully: 7• Supply: 2• Shift vs. movement: 1• Normal/inferior goods: 1

Question: what are you struggling with the most in the supply & demand unit?

READING CAREFULLY &

REMEMBERING WHAT CAUSES MOVEMENT

AND SHIFTS

How to successfully answer supply and demand problems:

TASK #1: Complete the “reading carefully” worksheet & discuss

TASK #2: Complete the “resource sheet” worksheet to help you prepare for

a quiz next tuesday/wednesday.

How to successfully answer supply and demand problems: