DETAILED LESSON PLAN IN ENTREP 12

I.OBJECTIVES
At the end of the lesson students will be able to;
1. List the determinants of Demand and Supply
2. Recognize which factor will cause demand curves to shift, and
3. Determine equilibrium using a demand/supply graph, and show the effects on price and
quantity when equilibrium price changes.

II. SUBJECT MATTER

Topic: An Introduction to Demand and Supply
Reference: Introductory to Macroeconomics

III.PROCEDURE

A. Routinary Activity
- Prayer
- Checking of Attendance
- Collecting of Assignments

B. Review of Lesson
Good Morning class!
Good Morning Ma’am!
What can you remember from our lesson
last meeting?
Ma’am we discussed about the circular flow of
economic activity.
Very Good!
Who can give a brief insights about
circular flow of economic activity
Ma’am we have learned that producers get
their raw materials on the households and
household get paid through it. The producing
unit will use these resources to produce goods
that will be sold to the consumer/household.
Very Good!

C. Motivation
Show a picture about two different
markets, where in the market 1 the supply
is high and the demand is low. While the
other market, the supply is low and the
demand is high.

PICTURE PICTURE

Market 1 Market 2
Ask their opinion about the pictures.
(Students’ answers may vary.)
D. Presentation of the lesson
Based on the pictures shown, What do you
think is our topic this morning?
(Student’s answer may vary.)
Until one student answered, “Demand and
Supply?”
Very Good!
Our topic this morning is Introduction to
Demand and Supply.
 The following are our objectives in this
topic. At the end of the lesson, you will
able to:

- List the determinants of demand and

supply
- Recognize which factors will cause
demand curve to shift, and
- Determine equilibrium using a
demand/supply graph, and show the
effects on price and quantity when
equilibrium changes.

E. Development Activities
a. Activity
Divide students into two (2)
groups. One group will represent as
seller and the other group will
represent as buyers. This is a five
minutes activity.
On the first situation the seller has
plenty of good but the buyers are few.
While the second situation the sellers
lack of supply of good but has many
buyers
After the activity, ask the students how
the price of the goods changes in the
two different situations.
b. Analysis
Let us find out if your answers are
correct.
MARKET- is a means of interaction between
buyers and sellers for trading or exchange.

3 COMMON TYPES OF MARKET

1. GOODS MARKET
2 TYPES OF GOODS MARKET
A. Wet Market- the market
wherein we buy pork, chicken
or fish.
B. Dry Market- the market where
we buy clothes and shoes.
2. LABOR MARKET
- is where workers offer their
services and employers look for
workers to hire.
3. STOCK MARKET
- is where commodities traded consist
of securities of corporations.

DEMAND- is the quantity of a good that

buyers are willing to buy.
DEMAND SCHEDULE- shows the different
quantities that will be bought of a good, given
various prices.
DEMAND CURVE- is the graphical
presentation of the demand schedule.
DETERMINANTS OF DEMAND
1. PRICE- as the price increases the
quantity demanded of the good
decreases, causing a downward slope
on the demand curve. On the other
hand, if the price decreases the
quantity demanded of the good
decreases, causing an upward slope on
the demand curve.
2. PRICE OF RELATED GOODS- an
increase in the price of one product
will cause a decrease in the quantity
demanded of a complementary
product. In contrast, an increase in the
price of one product will cause an
increase in the demand for a substitute
product.
3. CONSUMERS INCOME- an increase in
income will enable him to buy more
even if the price is unchanged and that
is the shift of the demand curve to the
right. However, a decrease in income
will enable him to buy less of the good
and that is the shift of the demand
curve to the left.
4. SIZE OF THE POPULATION- an
increase in population results in a
greater demand since there will be
more consumers, causing the demand
curve to shift to the right. On the other
hand, a decrease in population causes
the aggregate demand to shift to the
left.
5. TASTE OF THE CONSUMER- a greater
preference of the consumer for the
good will lead him to buy more of it
even if the price is unchanged.
However, a consumer who develops
less taste for the good leads him to buy
less of it.
6. EXPECTATIONS- a consumer who
expects a future increase in income or
prices tends him to buy more at the
present time, causing the demand
curve shift to the right. Meanwhile, a
consumer who expects his income or
price of a good to decrease in the
future tends him to buy less at the
present time, causing a shift of demand
to the left.

SUPPLY- is the quantity of a good that sellers

are willing to sell.
SUPPLY SCHEDULE- shows the quantity of a
good to be offered at various prices.
SUPPLY FUNCTION- shows how the quantity
offered for sale of a good is dependent on its
determinants, the most important of which is
the price of good itself.
SUPPLY CURVE- is the graphical presentation
of the supply schedule.
 DETERMINANTS OF SUPPLY
1. PRICE- an increase in price leads to an
increase in quantity supplied, and a
price decrease will cause a decline in
quantity supplied.
2. COST OF PRODUCTION-an increase in
cost will result to a lower supply of the
good even if the price is unchanged. On
the other hand, a decrease in cost will
enable producer to increase
production.
3. TECHNOLOGY- the use of improved
technology in the production of a good
results in an increased output even if
the price is unchanged. However the
use of obsolete or improper
technology will result to a decrease in
supply.
4. AVAILABILTY OF RAW MATERIALS-
availability of raw materials leads to an
increase in supply. On the other hand,
scarcity of these resources will result
in a shift to the left of the supply curve.
c. Abstraction
The teacher will further discuss
the topic by using graphs explaining
the supply and demand.

Hypothetical Demand Schedule of Sugar

per day

Price of Sugar Quantity Demanded

(per kilo) (in kilos)
P18 40
20 35
22 30
24 25
26 20
28 15
30 10

Figure 15
Hypothetical Demand Curve for Sugar per day
 Hypothetical Supply Schedule of Sugar
per day
Price of Sugar Quantity Supplied
(per kilo) (in cavans)
P18 10
20 20
22 20
24 40
26 50
28 60
30 70

Figure 21
Hypothetical Supply Curve for Sugar per day

MARKET EQUILIBRIUM

EQULIBRIUM- means a state of balance.

EQUILIBRIUM PRICE- is the price where demand

and supply are equal.

COMPETITIVE EQUILBRIUM- is the point of

intersection the demand and supply curves.

Figure 27
Hypothetical Market Demand and Supply
Curve for Sugar per day

SURPLUS- if the market price is above the

equilibrium price, quantity supplied is greater
than quantity demanded.
SHORTAGE- if the market price is below the
equilibrium price, quantity supplied is less than
quantity demanded.
 d. Application
By giving these following goods
students will create a demand
schedule and a graphical presentation
showing the demand and supply.
This is an individual activity.
- Gasoline
- Rice
(Students will perform the activity.)
IV. EVALUATION
Get ¼ sheet of paper and answer the
following question:
1. It is the price where demand and supply
are equal. - Equilibrium Price
2. It is the quantity of a good that buyers are
willing to buy. - Demand
3. It is a common type of market where
workers offer their services and - Labor Market
employers look for workers to hire.
4. It is the quantity of a good that sellers are
willing to sell. - Supply
5. It is a means of interaction between
buyers and sellers for trading or exchange. - Market

V. ASSIGNMENT
Watch or read some news and chat
down what you have observed about inflation.
Write it in a ½ sheet of paper. Submit it next
meeting.

ABEGAIL C. BAÑEZ
Applicant