12th Grade Demande And Supply Lesson Plan Example (Economics)

Topic: Demand, factors affecting demande, Elasticity of Demand.

Objectives & Outcomes

• Define demand and supply and explain the relationship between them.
• Identify and describe the factors that affect demand.
• Calculate the elasticity of demand for a given product.

Content:

• Demand and supply
• Factors affecting demand
• Elasticity of demand

Materials

• Graph paper
• Pencils
• Calculator (optional)

Objectives & Outcomes

• Define demand and supply and explain the relationship between them.
• Identify and describe the factors that affect demand.
• Calculate the elasticity of demand for a given product.

Content

• Demand and supply
• The market demand for a product or service is the quantity that all buyers are willing and able to purchase at each potential price, given their consumption priorities, income and other factors. The market supply of a product or service is the quantity that all sellers are willing and able to offer at each potential price, given their production costs and other factors.
• The relationship between demand and supply is that, in a competitive market, equilibrium is reached when the quantity demanded and the quantity supplied are equal. At this equilibrium price, the quantity demanded equals the quantity supplied. At a higher price, the quantity demanded will be less than the quantity supplied, and there will be a shortage. At a lower price, the quantity demanded will be greater than the quantity supplied and there will be a surplus.
• Factors that affect demand
• The main factors that affect the demand for a product or service are:
• The price of related goods and services
• The price of the product or service itself, and the price expectations for the future
• The income and spending of consumers
• Price of related goods and services
• If the price of a related good or service changes, the demand for the product or service under consideration will likely change as well. For example, if the price of butter increases, consumers may substitute margarine for butter.
• Price of the product or service itself, and price expectations for the future-If the price of a product or service increases, consumers will likely reduce their demand for it in the short-term, unless they expect the price to decrease in the future. If the price of a product or service decreases, consumers may increase their demand for it in the short-term, unless they expect the price to increase in the future.
• Income and spending of consumers-The income and spending of consumers can affect the demand for a product or service, as it is one of the factors that they consider when making consumption decisions. If consumers' income increases, they may be able to afford to buy more of a product or service. If consumers' spending on other products or services increases, they may be able to afford to buy less of the product or service under consideration.
• Elasticity of demand
• Elasticity of demand is a measure of the responsiveness of the demand for a product or service to a change in its price. A product or service with a high elasticity of demand will experience a larger change in demand when its price changes, than a product or service with a low elasticity of demand.
• The formula for calculating the elasticity of demand for

a given product is:

where

• A positive elasticity indicates that the demand for the product or service is elastic, and a negative elasticity indicates that the demand for the product or service is inelastic.
• The elasticity of demand can be calculated using the following steps:
• Plot the graph of the demand curve for the product or service, and the graph of the supply curve for the product or service.
• Find the point of equilibrium, where the quantity demanded and the quantity supplied are equal.
• For the point of equilibrium, calculate the price and the quantity demanded.
• For the point of equilibrium, calculate the price and the quantity supplied.
• Subtract the price and the quantity demanded from the price and the quantity supplied to find the difference in price and quantity.
• Divide the difference in price and quantity by the price and quantity to find the elasticity of demand.
• Examples:
• Elasticity of demand for a product with a low price elasticity of demand is:
• Elasticity of demand for a product with a high price elasticity of demand is:
• Elasticity of demand for a product with a positive elasticity of demand is:
• Elasticity of demand for a product with a negative elasticity of demand is:

Outcomes

• After completing this lesson, the student should be able to:
• Define demand and supply and explain the relationship between them.
• Identify and describe the factors that affect demand.
• Calculate the elasticity of demand for a given product.

Resources

• Teacher Instructional Guide
• Teacher Notes
• Handouts
• Video Tutorials
• Online Resources
• Teacher Reference Materials

Developed by: Rafaela Silveira

Evaluated by:

Alessandra Lopes

Silvia Lara

Guided Practice

Learning Objective:

To understand the concept of demand, factors affecting demand

Activities:

1. As a class, brainstorm a list of factors that might affect demand for a product or service.

2. As a class, brainstorm a list of examples for each factor on the list.

3. Review the list of factors and examples as a class.

4. Have students work in small groups to analyze the list of factors and examples and identify any patterns or trends.

5. Have each group present their findings to the class.

6. As a class, discuss the factors that were identified and any additional insights that may have been gained during the activity.

Guided Practice

Learning Objective:

To understand the concept of elasticity of demand and how to calculate it

Activities:

1. As a class, brainstorm a list of low-priced and high-priced products or services.

2. As a class, brainstorm a list of products or services that are very elastic, moderately elastic, slightly elastic, and inelastic, based on their price elasticity of demand.

3. Review the list of products or services and their elasticity as a class.

4. Have students work in small groups to analyze the list of products or services and their elasticity.

5. Have each group present their findings to the class.

6. As a class, discuss the products or services that were identified and any additional insights that may have been gained during the activity.

Guided Practice

Learning Objective:

To demonstrate how to calculate the elasticity of demand for a given product or service

Activities:

1. Have students work in small groups to choose a product or service and calculate its price elasticity of demand.

2. Have each group present their calculations and findings to the class.

3. As a class, discuss the calculations and insights gained from the activity.

4. Discuss the concept of elasticity of demand and how it applies to the product or service that was studied.

Guided Practice

Learning Objective:

To understand how to interpret the results of a calculation of the elasticity of demand

Activities:

1. Have students work in small groups to calculate the price elasticity of demand for a product or service.

2. Have each group present their calculations and findings to the class.

3. As a class, discuss the calculations and insights gained from the activity.

4. Discuss the concept of elasticity of demand and how it applies to the product or service that was studied.

Guided Practice

Learning Objective:

To apply the concept of elasticity of demand to real-world situations

Activities

1. Assign a project for students to research the elasticity of demand for a product or service in their community.

2. Have students prepare a presentation on their findings and their interpretation of the results.

3. Have students present their findings to the class.

4. Discuss the results and any additional insights that may have been gained from the activity.

Elapsed Time:

45-60 minutes

Independent Practice

Learning Objective:

To apply the concept of elasticity of demand to real-world situations

Activities:

1. Have students select a product or service that they use on a regular basis.

2. Have students calculate the price elasticity of demand for the product or service.

3. Have students analyze their calculations and interpret the results.

4. Have students create a project that applies the concept of elasticity of demand to the product or service that they selected. This could be a presentation, a report, or another format of the student's choice.

5. Have students submit their projects for evaluation.