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The difference between

The difference between. Change in Supply and change in Quantity Supplied. $8. $7. $6. S. $5. b. PRICE per Greebe. $4. a. $3. $2. $1. 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. 12. 13. 14. 15. 16. QUANTITY. (hundreds of Greebes per week). A change in price creates.

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The difference between

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  1. The difference between Change in Supplyand change in QuantitySupplied

  2. $8 $7 $6 S $5 b PRICE per Greebe $4 a $3 $2 $1 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 QUANTITY (hundreds of Greebes per week)

  3. A change in price creates Movement from point a to point b

  4. SLIDE • Movement from point a to point b is a slide “on or along” the supply curve, resulting only from a change in price • This is not a change in supply!!!!!!!!! • only a change in quantity supplied because of a price change

  5. Remember “Ceteris Paribus” Let’s change one of the conditions which we held constant when we established the original supply schedule for Greebes – these variables are referred to as the non-price determinants of supply

  6. A change in the Non-price DETERMINANTS OF SUPPLY • – results in a shift in the Supply Curve • CHANGES THE QUANTITY SUPPLIED AT EACH AND EVERY PRICE

  7. What does a Change in Supplylook like? A SHIFTor new supply curve

  8. $8 $7 s2 $6 S $5 b PRICE per Greebe $4 s1 a $3 $2 $1 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 QUANTITY (hundreds of Greebes per week)

  9. Review Time!!!! I told you this would be hard…

  10. Daily Double

  11. Compare 2000 with 2001. Which of the following statements is (are) true? Year Quantity Sold Price 2000 30,000 $10. 2001 50,000 $20. • Demand has increased • Quantity demanded has increased • Supply has increased • Quantity supplied has increased • Supply has decreased A. I only B. V only C. I and IV only D. I and V only E. I, II and III only

  12. Gotcha! • Quantity demanded only increases or decreases by sliding along the demand curve • When there is a change in demand, there is a new quantity demanded at each and every price • The correct answer is C

  13. s Price p d1 d Q Quantity

  14. Non-price Determinants of Supply:Factors that shift the Supply Curve “ROTTEN”

  15. “R” is for resource Changes in resource prices or input costs Elements of nature and political disruptions

  16. “O” is for other Change in Prices of other goods produced and offered for sale

  17. “T” is for technology Changes in technology

  18. “T” is for taxes Changes in taxes and subsidies

  19. “E” is for expectations Change in expected future prices, (producer) expectations

  20. “N” is for number Change in the number of suppliers in the market Elements of nature and political disruptions

  21. Non-price DETERMINANTS OF SUPPLY • Changes in resource prices or input costs • Elements of nature and political disruptions • Change in Prices of other goods produced and offered for sale • Changes in technology • Changes in taxes and subsidies • Change in Expected future prices (producer) expectations • Change in the number of suppliers in the market • Elements of nature and political disruptions

  22. Quick tip Any factor that increases the cost of production decreases supply Any factor that decreases the cost of production increases supply

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