supply and demand curves
reflect shifts in supply and demand curves
direct scarce resources
The foundation of economic activity is the market, in which buyers
and sellers meet. This workshop focuses on the laws of supply and
demand and their effects on the allocation of resources. The laws
of supply and demand are not only critical to an understanding of
economics; they are also models for understanding human behavior.
Carol Penland's class at
South Cobb High School in Austell, Georgia, participates in a simulated
market of classroom-baked cookies. Through this exercise students
learn how the forces of supply and demand move prices towards equilibrium
and they get a sense of the "invisible hand" that drives
Dick Rankin's honors class
at Iolani High School in Honolulu, Hawaii, demonstrates how profits
direct scarce resources to their most valued uses in a free market
by functioning as positive and negative incentives for consumers and
producers and, conversely, how barriers to entry in a monopoly market
prevent that same dynamic from taking place.
Richie Kibota's class at
Iolani High School participates in a simulation exercise on cartels.
They learn how cartels generate profits by restricting production
and why they eventually break up.
"I think one of the hardest
things that students have comprehending in economics is
the law of supply and demand. Even though they know these
things, no one has ever used the vocabulary with them
- supply and demand, quantity demanded, quantity supplied.
I still have students coming into my class at the beginning
of the semester that think the government sets the prices
for everything. They don't understand that it's consumers
and sellers deciding what the prices will be. So this
has been a difficult concept for most students to grasp.
Once they get it then everything else in economics kind
of falls in place."