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CHAPTER SIX

CHAPTER SIX. PRICES. When demand meets supply Demand greater than supply – shortage Supply greater than demand - surplus. Equilibrium. Price ceilings Rent control Price floors Minimum wage. Government interference with prices. Read 137-140

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CHAPTER SIX

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  1. CHAPTER SIX PRICES

  2. When demand meets supply • Demand greater than supply – shortage • Supply greater than demand - surplus Equilibrium

  3. Price ceilings • Rent control • Price floors • Minimum wage Government interference with prices

  4. Read 137-140 • What is the argument for and against rent control? • With partner, answer number 1 + 2 on p. 138 Prices

  5. What is the argument for and against minimum wage? • With partner, answer number 1 + 2 on p. 139 Prices

  6. With table partner, complete Number 11 on page 140 Assessment

  7. What are the two ways in which the government controls prices? Please provide an example of each. Question of the Day

  8. Moving toward Equilibrium - Price and quantity will move toward equilibrium levels Two Factors that can lead to Disequilibrium -Shift in supply curve -Shift in demand curve Changes in Market Equilibrium

  9. An Increase in Supply • A Changing Market that increases supply • Inventory will pile up (surplus) • Suppliers will reduce prices to clear out the surplus • With the lower price, demand will increase and the market will find equilibrium

  10. A Decrease in Supply • As supply decreases, suppliers will raise their prices • Demand will fall • With the lower price, demand will increase and the market will find equilibrium

  11. An Increase in Demand • Supply . . . • Price . . .

  12. A Decrease in Demand • . . . • . . .

  13. Complete Number 10 on page 147

  14. Supply shock • Rationing • Black market Vocabulary

  15. In your notebook: • Design a supply/demand curve that illustrates a change in equilibrium based on an increase in supply. Question of the Day

  16. Review • How does the government affect supply? (3) • How does the government affect prices? (2) Review

  17. Equilibrium • Disequilibrium • Shortage • Surplus • Supply shock • Rationing • Black Market • Price ceiling • Rent control • Price floor • Minimum wage • Inventory • Fad Chapter 6: Pictionary Time

  18. What could be negative consequences to: • A. Rent control • B. Minimum wage Question of the day.

  19. Sketch: • Advantages of Price-based system • Shortage and Surplus • P. 155

  20. Pop Quiz

  21. Design your own business • Select a name and product • Graph how your business would respond to: • Supply shock • Increase in supply • Decrease in demand • Increase in demand • Explain the reasons for the above • Be realistic and be neat! • Due at the end of class on Friday Your Group Project (1-3 members)

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