Salient Features of India constitution especially power and functions
Law of demand 2014
1. Bellringer
1. Which allocation method does your family use to
distribute resources?
2. Which method do sellers ebay use?
3. Which method is used on Wall Street?
Brute force
First come, first serve
Rationing (usually equal)
Rationing by committee
Based on need (poorest)
Contest based
Random lottery
Auction – willing to pay
2. Economists like Auction too
We use price because it lowers opportunity
cost
Brute force
First come, first serve
Rationing (usually equal)
Rationing by committee
Based on need (poorest)
Contest based
Random lottery
Auction – willing to pay
3. Where do prices come from?
• XBOX1 OR PS4
• Demand
• The combination of how much people will buy at a
certain prices, at a certain time period (week,
month, year etc)
• Why important for entrepreneurs or managers?
10. Law of Demand
Law of Demand: As price declines, quantity demanded
increases. As price increases, quantity demanded
decreases
Law of Demand: P Therefore Q demand
P Therefore Q demand
Demand curve always
slopes down
11. Why do businesses care?
• Demand predicts revenue
• Revenue = Price X Quantity sold
Cookies
Price QD*Day Revenue
$0.20 7
$0.40 4
$0.60 2
$0.80 1
$1.00 1
$1.20 0
12. On your BR
4. 3 goods or services you buy more of when they go
on sale
5. An example of something you try to conserve
because its expensive
6. What price should this company choose if they
want to maximize revenue?
13. Currently organ donation in the US is done
by donation only, and first come first serve.
4. Write a paragraph
comparing and
contrasting this
allocation method with
an auction for kidneys
where people on the
waiting list could buy
kidneys from donors.
Which method do you
think is best?
