Explanation should include
- definitions of supply, demand, elastic demand, and inelastic demand
- how price interacts with supply and demand
- influences on supply and demand.
Process/Skill Questions:
- What is the difference between elastic and inelastic demand?
- When is supply-demand equilibrium achieved? How is it characterized?
- What is an example of a situation in which a shortage is caused by a change in supply? A change in demand?
Teacher Resource: