Law of Demand - Why Price Matters
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- Guided notes
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- Activity + answer key
- Quiz + answer key
- Exit ticket + answer key
- Teacher guide
- Teacher presentation notes
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What students do
- Read the movie-ticket demand curve and demand schedule to predict quantity demanded at a new price
- Distinguish a movement along the demand curve from a shift in the whole curve
- Explain a personal purchase decision using either the substitution effect or the income effect
- Apply ceteris paribus to isolate why price alone changes quantity demanded
What it covers
- The law of demand, as price rises, quantity demanded falls, all else equal
- How a demand schedule becomes a demand curve, using the movie-ticket example
- The two reasons the law holds, the substitution effect and the income effect
- Why ceteris paribus matters for isolating price as the one variable in motion
Learning targets
- State the LAW OF DEMAND (price up = quantity demanded down, all else equal) and read a downward-sloping demand curve and the demand schedule behind it
- Distinguish a MOVEMENT ALONG the demand curve (caused only by a price change) from the two reasons price drives quantity demanded - the SUBSTITUTION EFFECT and the INCOME EFFECT
- Use a real demand schedule and demand curve to predict how quantity demanded changes when price changes, and explain WHY price is the key variable held in focus by ceteris paribus
From one teacher to another
I want students able to redraw the movie-ticket demand curve from memory, because once they can read price off the vertical axis and quantity off the horizontal, half of economics starts making sense. I split the substitution effect from the income effect on purpose since students conflate them constantly, and the exit ticket won't let them off the hook: they have to pick a real purchase and name which one explains their own behavior. This is a graph-reading lesson first and a vocabulary lesson second.
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