Fin Lit - Supply and Demand

Unit 9 - Modeling a Business

​First Topic - Supply and Demand

Learning Target: We will learn about Supply and demand and their effects on how a business operates

​What is a widget?

-An unnamed product

-When it is developed, the suits discuss how many to produce

-This is where graphs come in

-p (price): x-axis, independent variable, domain

-q (quantity sold): y-axis, dependent variable, range

Demand function

-Relates the quantity of its product to the price

-As price increases, demand goes down

-What type of correlation might this be? Positive or negative?

-Will this be linear or exponential?

Multiple Choice

An economist finds out about a new gadget a business produced for their operations. What is it?

• Gadget

• Widget

• Doohicky

• A thing

Multiple Choice

The demand function is an example of ______________ correlation

• Positive

• Negative

Supply

-Quantity of items available to be sold

-If a widget sells for a high price, the quantity will likely go up

-As price goes up, supply goes up

-Positive correlation

Wholesale Price

-Price the manufacturer charges the retailer

-Some retailers will sell at the wholesale price

-Can you think of any

-Others will Markup the price which is often the case

Retail Price

-Price at which retailers sell to the public after markup

-Often the case when retailers sell products

A visual representation of supply and demand

Cocoa Beans

Supply and Demand chart

Multiple Choice

Toyota just got its round of new Tundra's off of the assembly line and sent them to a dealer here in Pensacola. What is Toyota selling them to the dealer for?

• Markup Price

• Retail Price

• Wholesale price

Multiple Choice

BMW has 20 of their SUVs in the shops ready to be sold to dealers across the country. This is their _______________

• demand

• supply

• wholesale

• widget

Multiple Choice

Walmart just received a whole shipment of Little Trees for their automotive department. They increased the price before selling to their customers. This was a __________

• widget

• wholesale

• markup

• supply

The point where supply and demand "meet up" or intersect

Equilibrium

Multiple Choice

Price and quantity of Meguiar's detail brushes in America just hit a perfect balance between supply and demand. This is known as ____________

• Equilibrium

• supply

• demand

​How to calculate markup

-simple multiplication

-Markup rate times the wholesale price

-Add to the original price to find the retail price

Multiple Choice

The wacky widget company sells widgets for 2 dollars each. A local store has a markup price of $1.59. What is the retail price?

• $4

• $3.59

• $0.41

• $2

Multiple Choice

The whole sale price of an item is x dollars. The retail price is r dollars. Express the markup algebraically.

• rx

• r - x

• r/x

• r + x

Multiple Choice

Robear Corp sells teddy bears at a wholesale price of $23. If a store marks this up 110%, what is the retail price?

• $48

• $48.30

• $48.50

• $48.40

Multiple Choice

A banner company sells 5-foot banners to retailers for x dollars. The St. James sign shop marks them up by 90 percent. Express the retail price at the St. James store algebraically.

• x - x*0.9

• x + x*0.9

• x/x*.9

• x + x/9

Multiple Choice

Why does the demand function have a negative slope or negative correlation?

• When there is more of something, the value goes down

• When there is less of something, the value goes up

• Because when there is a widget that works, everyone wants it