Economics · Lesson Plan
Supply and Demand
The laws of supply and demand explain how a market sets the price and quantity of goods. In this hands-on lesson, students receive classroom currency and bid in three auctions — a low-demand item, a single high-demand item, and the same item in high supply — then discover for themselves how scarcity and abundance move prices. An activity sheet locks in the vocabulary.
For Teachers
Lesson at a glance
- Topic
- Economics
- Grade Level
- Grades 6–10
- Resource Type
- Lesson + Worksheet
- Estimated Time
- 45–60 minutes
- Format
- Lesson + activity
- Materials
- Printable lesson, worksheet, whiteboard
What Students Learn
Learning objectives
- Define supply and demand
- Describe what happens when demand exceeds supply
- Describe what happens when supply exceeds demand
- Give real examples of each situation
- Connect auction prices to scarcity and abundance
Materials
What you’ll need
- Printed lesson and activity sheet (one per student)
- Classroom currency (play money) for bidding
- One undesirable item and a set of desirable treats to auction
- Whiteboard for the price/quantity record
Key Terms
Vocabulary
- Supply
- The quantity of a good or service available to buy.
- Demand
- How many people are willing and able to buy at a given price.
- Price
- What buyers pay and sellers receive for a good.
- Scarcity
- Limited availability of a good relative to demand.
- Surplus
- When supply exceeds demand.
- Price stabilization
- The balance reached when supply and demand are matched.
For Teachers
Lesson plan
Estimated time: one 45–60 minute class period.
Lesson sequence
- Set up (8 min). Give each student a small grant of classroom currency; explain the auction rules.
- Run three auctions (20 min). Auction A (low-demand item), Auction B (one high-demand treat), Auction C (“discover” 25 more of the treat). Record winning bids.
- Discuss (12 min). Why did Auction B fetch more than C? Why did A go cheap? Lead students to define supply and demand.
- Activity sheet (10 min). Students write a paragraph using supply, demand, price, increase, decrease, and give examples of each imbalance.
Assessment
Assess the completed activity sheet for correct use of the vocabulary and sound examples.
Discussion
Discussion questions
- What is the difference between supply and demand?
- What happens to price when demand exceeds supply?
- What happens to price when supply exceeds demand?
- Why did the single treat sell for more than when there were many?
- Where have you seen supply and demand at work in real life?
Printable Lesson & Activity
Supply and Demand — Lesson & Activity Sheet
A printable supply-and-demand lesson with a three-auction classroom simulation and a student activity sheet.
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