Do Now: 3/11/13

What if the price of gas went up to $10 a gallon

today?

How would the country respond? How might it

affect your life? Protests in the Middle East last year made fuel supplies

seem unstable, allowing producers to raise gas prices

5.1: Introduction to Demand

Objective: Explain the law of demand; define and use the terms: markets, demand, and quantity demanded

Guiding Question: Why do people buy more on Black Friday?

Important Terms: Markets

A market exists when people come together to buy and sell

The buying side of any market is called the demand

The selling side of any market is called the supply

In the Housing market, people buy and sell residential

properties

Important Terms: Demand

Demand is both the willingness and ability to buy a good or service Willingness: Do I want

to have it? Ability: Can I afford to

buy it?

Important Terms: Quantity Demand

Quantity demanded (Qd) is the number of a good purchased at a specific price

The Law of Demand

The Law of Demand says that when the price of a good goes up, the quantity demanded for that good goes down.

And, when the price of a good goes down, the quantity demanded goes up.

This graphs shows that when P goes up, Qd goes down