2. S & D Interaction lecture power point

2. S & D Interaction lecture power point

1. SUPPLY AND DEMAND INTERACTION

2. PRICE QUANTITY Q P P3 P2 S D EQUILIBRIUM

3. EQUILIBRIUM POINT IT IS A POINT AT WHICH THE SUPPLY CURVE INTERSECTS THE DEMAND CURVE IT IS THE POINT OF “PERFECT COMBINATION” WHERE SUPPLY IS JUST EQUAL TO DEMAND

4. The EQUILIBRIUM is the point at which the price (P) and quantity (Q) of the commodity that the buyers are willing to buy, is just equal to the price (P) and quantity (Q) that producers are willing to produce and sell.

5. STEPS TO ASSESS S AND D STEP 1: determine the factor or event that will have an effect on either Supply or Demand curve. STEP 2: Determine what curve will be affected: Supply and Demand STEP 3: Determine what factor/s affect the specific curve will affect the curve.

6. STEP 4: Given the factor coming into play and its effect on the specific curve, determine how the curve will react or be affected. A. Shift to the Right B. Shift to the Left C. Move along the curve

7. STEP 5: Given the movement or the effect on the curve, plot the new equilibrium point. STEP 6: Given the new equilibrium point, plot and assess the new price and quantities of the new supply and demand curve interaction.

8. Assessing Supply and Demand 1. Assume that there was an increase in fertility rate for a period of one year. STEP 1:INCREASE IN FERTILITY RATE STEP 2: An increase in fertility rate will increase the demand for

9. Assessing Supply and Demand 1. Assume that there was an increase in fertility rate for a period of one year. STEP 3: An increase in fertility rate will the demand curve for laboratory test (CBC, urinalysis) by increasing the population or number of pregnancies

10. Assessing Supply and Demand 1. Assume that there was an increase in fertility rate for a period of one year. STEP4: an increase in number of fertility will cause the demand curve for some laboratories to shift to the right.

11. PRICE QUANTITY Q P P3 P2 S D EQUILIBRIUM

12. Assessing Supply and Demand 1. Assume that there was an increase in fertility rate for a period of one year. 2. Assume that there was a surge in birth rate for period of one year. 3. Assume that there was a decrease in number of individual using unhealthy product ( e.g cigarettes )

13. 4.There is an epidemic of Measles in region where you live. 5.Assume that every household has lower income which makes commodities expensive. 6. Assume that there is an increase in Pregnancy rate 7.Pfizer Company distributes medications at lower price for a period of 6 months. 8.Assume that there is an increase in the prevalence of STI.

14. 1.There is an epidemic of Measles in region where you live. 2 .Assume that every household has lower income which makes commodities expensive. 3. Assume that there is an increase in Pregnancy rate