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Lesson 2.2 Market Price

Why isn’t $20 a fair price for a dozen cookies? To whom would this be unfair? Why? Why isn’t $1 a fair price for a dozen cookies? To whom would this be unfair? Why?. Lesson 2.2 Market Price. Essential Question: How are prices determined in a competitive market?.

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Lesson 2.2 Market Price

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  1. Why isn’t $20 a fair price for a dozen cookies? To whom would this be unfair? Why? Why isn’t $1 a fair price for a dozen cookies? To whom would this be unfair? Why?

  2. Lesson 2.2Market Price Essential Question: How are prices determined in a competitive market?

  3. To find the market price, you must bring the buyers and sellers of cookies together and have them interact together. The market forces of supply and demand will create a price that is fair for both the buyer and the seller.

  4. The market price or equilibrium price is the price at which the supply and demand curves intersect. MP

  5. If producers charge a price above the market price, there will be a surplus because more will be supplied than demanded. surplus

  6. If producers charge a price below the market price, there will be a shortage because more will be demanded than supplied. shortage

  7. What is the current market price of a dozen cookies? “The Supply and Demand for Cookies” 1. Price (in dollars) Quantity (in dozens)

  8. What is the current market price of a dozen cookies? “The Supply and Demand for Cookies” 1. Price (in dollars) $5.60 Quantity (in dozens)

  9. How many dozens of cookies would be offered for sale at that price? How many dozens of cookies would be demanded at that price? “The Supply and Demand for Cookies” 1. Price (in dollars) $5.60 Quantity (in dozens)

  10. How many dozens of cookies would be offered for sale at that price? How many dozens of cookies would be demanded at that price? “The Supply and Demand for Cookies” 1. Price (in dollars) $5.60 2,780 Quantity (in dozens)

  11. How many dozens of cookies would be offered for sale at $7? How many dozens of cookies would be demanded at $7? “The Supply and Demand for Cookies” 2. Price (in dollars) Quantity (in dozens)

  12. How many dozens of cookies would be offered for sale at $7? How many dozens of cookies would be demanded at $7? “The Supply and Demand for Cookies” 2. Price (in dollars) 4,000 2,000 Quantity (in dozens)

  13. Why is $7 per dozen not a good idea for sellers? “The Supply and Demand for Cookies” 2. Price (in dollars) 4,000 2,000 Quantity (in dozens)

  14. Why is $7 per dozen not a good idea for sellers? “The Supply and Demand for Cookies” 2. Surplusof 2,000 Price (in dollars) 4,000 2,000 Quantity (in dozens)

  15. How many dozens of cookies would be offered for sale at $4? How many dozens of cookies would be demanded at $4? “The Supply and Demand for Cookies” 3. Price (in dollars) Quantity (in dozens)

  16. How many dozens of cookies would be offered for sale at $4? How many dozens of cookies would be demanded at $4? “The Supply and Demand for Cookies” 3. Price (in dollars) Quantity (in dozens)

  17. Why is $4 per dozen not a good idea for sellers? “The Supply and Demand for Cookies” 3. Price (in dollars) Shortageof 2,100 Quantity (in dozens)

  18. Lesson 2.2 Market PriceSummarizer: Despite a surplus that is the result of a high price and a shortage that is the result of a low price, how does the market eventually return to equilibrium?

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