Welc

ome

To

Our
Pres
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tatio

Microeconomics Final
Project
Eva Pizzarelli, Andrew Ruiz & Carolina
Castrillon

Entrance Ticket
- As a consumer, how do you decide which products to
buy? Why?
Price/Salary, Surplus/Shortage, and Popularity

Judges will look for:

1. States essential question and answer it
2. Clearly explains project and significance of the
assignment
3. Contains strong components on my project that stand
out teaching a concept that can be beneficial going
forward in life.
-Essential Question -Audience -Content

Vocabulary You May Need

Consumers: are the individual people in society purchasing as well using
goods and services everyday.
Producers: are the individual corporate workers that decide what to
create or have in a society and at what price.
Shortages: A market condition existing at any price where the quantity
supplied is less than the quantity demanded.
Surplus: A market condition existing at any price where the quantity
supplied is greater than the quantity demanded.
Equilibrium: the point in which the supply and demand of a particular
good is relatively the balanced.

Essential Question
-

How do market forces (producers) exert influence on the lives of

businesses and individuals (consumers)?

Answer: Factors such as price/salary, surplus/shortages, and popularity

influence the way consumers and producers interact in economy. These factors
have a huge impact on the growth of the economy because the higher the
demand for a product the more it will be created to be sold. This can cause the
cost of a particular item to go up or down whether the business that produces it
is making a profit or not. The businesss overall profits on the product they
manufacture will determine whether the price of that item increases or
decreases.

Surplus Definition
A market condition existing at any price where the
quantity supplied is greater than the quantity
demanded.

Shortage Definition
A market condition existing at any price where the
quantity supplied is less than the quantity
demanded.

Our Surplus Example

We chose candy because for
Halloween people need candy to
give out. Making stores want to
stock up on candy because they
know it will be profitable, but
usually the supply is greater than
the demand.
The Candy was two for
$2.00 or one for $1.49

Our Shortage Example

There was a shortage of peanuts at
the Blackstone Market because
peanuts provide protein and people
want to be healthy.

Each bag of Peanuts cost $2.99

Supply and Demand Graph

P
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i
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P
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Surplus

P
a
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Surplus Example

Supply and Demand Of Candy

Pressure

nd
Ca

Equilibrium
Shortage
The supply of candy is higher
than the demand, so there is a
surplus.
Quantity of Candy

Supply and Demand Graph

P
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P
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Surplus

B
a
g
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Shortage Example

Supply and Demand of

Peanuts

Pressure

uts
n
a
Pe

Equilibrium
Shortage

Quantity of Peanuts

The demand for peanuts is

greater than the supply, so there
is a shortage.

Scenario 1 (Candy)
When the supply of candy increases the equilibrium price lowers. Producers
want to create and sell what is making money. As long as candy is selling, the
price will gradually go down and manufacturers will continue to produce
candy.
P
r
i
c
e

O
f
C
a
n
d
y

Old
Supply

New
Supply

Demand

Quantity of Candy Supplied

Example: During the month of

October producers expect
consumers to buy more candy for
Halloween. So more candy is
produced in order to meet the
expected demand of candy. While
the price slightly drops to compete
with competitors.

Scenario 2 (Candy)
When the supply of candy decreases the equilibrium price of this product goes
up. Producers want to create and sell what they can manufacture. If the supply
of candy is expected to decreases after Halloween then producers will produce
more. The cost of candy may rise due to the fact there is a shortage of candy
and producers want to get the most out of their money.
P
r
i
c
e
O
f
C
a
n
d
y

New
Supply

Old
Supply

Demand

Quantity of Candy Supplied

Example: After Halloween the

supply of candy decreases because
individual consumers stocked up
before the holiday. Producers want
to make a profit so when there is a
shortage of candy being produced
the cost will go up to meet the
demand for this good.

Scenario 3 (Candy)
When the equilibrium price of candy drops the demand increases . Consumers
assuming their rational thinkers want to get the most out of their money. A
lower cost means consumers can obtain a higher quantity of goods.
P
r
i
c
e
O
f
C
a
n
d
y

Supply

New
Demand
Old
Demand

Quantity of Candy Demanded

Example: Easter is coming so

businesses choose to market more
chocolate bunnies. Consumers
expect there to be a decrease in
the price for chocolate bunnies as
a result of the rise in quantity.
Consumers will buy more
chocolate bunnies than usual to
get the most out the low prices.

Scenario 4 (Candy)
When the equilibrium price of candy goes up the demand decreases .
Consumers assuming their rational thinkers want to get the most out of their
money. A higher cost means consumers can obtain a lower quantity of goods.
P
r
i
c
e

Supply

O
f
C
a
n
d
y

Old
Demand
New
Demand

Quantity of Candy Demanded

Example: After Valentines the price for

heart shaped chocolate boxes is
expected to increase because the supply
as well as demand will lower for this
product. Consumers want to buy more
when they have more money, but if the
price of a product goes up then they
cant buy as much.

Scenario 1 (Peanuts)
When the supply of peanuts increases the equilibrium price lowers. Producers
want to create and sell what is making money. As long as peanuts are selling,
the price will gradually go down and manufacturers will continue to produce
more peanuts.
P
r
i
c
e

Old
Supply
New
Supply

O
f
P
e
a
n
u
t
s

Demand

Quantity of Peanuts Supplied

Example: Producers expect for there

to be an increase in demand for
peanuts during baseball season. So
they plan to produce more peanuts
and lower the cost because they are
going to sell more often than usual.

Scenario 2 (Peanuts)
When the supply of peanuts decreases the equilibrium price of this product
goes up. Producers want to create and sell what they can manufacture. If
there is shortage of materials because of taxes peanuts may not be as
profitable as before.
P
r
i
c
e

New
Supply
Old
Supply

O
f
P
e
a
n
u
t
s

Demand

Quantity of Peanuts Supplied

Example: The price of salt goes up

causing producers to have to spend
more money for the production of
salted peanuts. In return the price
per bag of peanuts goes up at
every given price to ensure that the
producers are making a profit.

Scenario 3 (Peanuts)
When the equilibrium price of peanuts drops the demand increases .
Consumers assuming their rational thinkers want to get the most out of their
money. A lower cost means consumers can obtain a higher quantity of goods.
P
r
i
c
e

Supply

o
f
P
e
a
n
u
t
s

New
Demand
Old
Demand

Quantity of Peanuts Demanded

Example: The cost of peanuts are

expected to go up because of a
storm that is coming and going
destroy peanut crops. As a result
the cost of peanuts will go up after
the storm passes.

Scenario 4 (Peanuts)
When the equilibrium price of peanuts goes up the demand decreases .
Consumers assuming their rational thinkers want to get the most out of their
money. A higher cost means consumers can obtain a lower quantity of goods.
P
r
i
c
e

Supply

O
f
P
e
a
n
u
t
s

Old
Demand
New
Demand

Quantity of Peanuts Demanded

Example: Producers now have to pay tax

to make peanuts so because producers
are making less profit the cost will go up
to sell them. Consumers will buy less
peanuts because now they are more
expensive.

Exit Ticket
What will you consider in the future when deciding
whether or not to purchase a product from any retail store
or business?

The End !!!!

a
Ev

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And
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