Quantity Supplied and Quantity Demanded social studies lesson for kids

Quantity Supplied and Quantity Demanded social studies lesson for kids -  social studies skills studied in 2nd, 3rd, 4th, 5th grades.

Supply and demand is a term that refers to how economists and businesspeople understand two things: the amount of a product that is being made and stocked, and how much of the product people are willing to buy. Understanding this relationship helps the people involved learn how to calculate the price of a product.

However, this topic can become a little more complicated. Demand is defined by the amount of a product that customers want to buy; for example, if a restaurant sells twelve plates of spaghetti every day, their demand for spaghetti is twelve plates. However, there is another term that comes into play: the quantity demanded, which refers to how much of a product customers are willing to buy while it costs market price.

A Fun Game On Supply and Demand

While demand might increase because there are more customers or because one particular product becomes better than another, the increase in quantity demanded means that the product price is dropping. This is because people are willing to buy more of a particular product when the price goes down. Let’s say that a woman goes to buy a box of her favorite cereal. The cereal usually costs three dollars for one box. Today, however, she notices that it has been marked down to two dollars a box. Because of this, she decides to buy two boxes. She buys twice as much cereal (twice as many products) as she usually does, because the product is cheaper. This is called the demand relationship. Continue reading below>>>

The quantity supplied, meanwhile, describes how much of a product its makers are willing to give while they make a certain price for their product. If a furniture company knows that it will make fifty dollars for a table, for example, they may decide that it is only worth their time to make thirty tables a week. However, if the price of a table jumps up to a hundred dollars, it is worth their while to make more tables, since they will make more money. This is different from supply, which refers simply to the amount of a particular product someone has at a given time.

If the quantity supplied increases, this always means that the product has gone up in price. This is because people and businesses who produce goods need to know that they will make money off of a certain product, since making products to sell also costs money. There are tools that are needed, employees to pay, and more. For example, a pizza restaurant doesn’t just make money; it also spends money by paying people to work, buying flour, eggs, tomatoes, pepperoni, and cheese to make into pizzas, repairing things if they break, and running lights and water to the restaurant. If the price of their pizzas go up, however, they will be able and willing to make more pizza, since they are making more money that will help them do all the things they need to do to run their business. This way that the price of a product is connected to the supply is called the supply relationship.