1. Students will describe the concepts of, and conditions that affect, supply and demand

1. Intro to Business - Goods and Services and Supply and Demand 1. Students will describe the concepts of, and conditions that affect, supply and demand 2. Students will explain how needs and wants create opportunities for business 3. Students will understand the difference between goods and services and will be able to recognize them.

2. Goods and Services ·Businesses provide goods and services to supply people with the things that they need and want. ·Goods - have a dollar-and-cents, or monetary value, and are refered to as tangible. ·Services- have a monetary value because people are willing to pay for them, and are refered to as intangible.

3. In groups of three come up with a list of 5 goods (tangible) and 5 services (intangible) which teenagers might purchase.

4. Supply and Demand

5. Demand is the quantity of a good or service that consumers are willing and able to buy at a particular price.

6. When we buy a particular good or use a particular service, we are expressing a demand for it. Usually, consumers will increase the quantity demanded of a good or service as prices decrease. As prices increase, the reverse is true. This relationship is called the Law of Demand

7. Four Conditions that Creates Demand 1. Consumers must be aware of or interested in the good or service, advertising to create awareness. 2. Change in customers' taste, new music. 3. Change in expectations of future conditions, increase in income generally means increase in buying. 4. Change in population, creates an increase in need of goods and services. Brainstorm examples of when each of these conditions create demand.

8. Supply is the quantity of a good or service that producers can provide, determined by the cost of producing it and by the price people are willing to pay for it.

9. Conditions that Affect Supply - Cost of producing - Price consumers are willing to pay - Change in the number of producers - Price of related goods, if price of wheat decreases, farmers might move to produce another product. - Change in technology - Change in expectations Think of an example for how each of these conditions might affect supply.

10. Equilibrium: When supply and demand are equal (i.e. when the supply function and demand function intersect) the economy is said to be at equilibrium. At this point, the allocation of goods is at its most efficient because the amount of goods being supplied is exactly the same as the amount of goods being demanded. At the given price, suppliers are selling all the goods that they have produced and consumers are getting all the goods that they are demanding.

11. Price is the value of a product or service expressed in dollars and cents. Price is determined by many factors, including both demand and supply. And as you have seen, both demand and supply change as a result of the actions of the consumers and producers.

12. If consumer demand for a good or service is high while the supply of that same good or service is low, prices will tend to be higher. Conversely, if consumer demand for a good or service is high while the supply of that good or service is high, prices will tend to be lower. Prices tend to fluctuate, sometimes rapidly, because demand and supply are constantly changing.

13. Questions to Consider: 1. Why do people follow trends? 2. Have you ever wanted something because it's hard to get? 3. Are knock-off's ok (as long as it's not fraud)? 4. Why is a $2000 hand-bag worth that much money? Demonstrate your understanding: Complete the Supply and Demand Practice Activity found in the Student Common Drive