Work in pairs or small groups to answer the following questions: 1. What happens to the supply of bottled water during a drought? Draw a supply curve to illustrate your answer.
2. What happens to the demand for bottled water during a drought? Draw a demand curve to illustrate your answer.
3. Why do you think that the price of bottled water might rise sharply during a drought? Draw a demand and a supply curve to illustrate your answer.
Chapter Review Key Terms Checklist Using a pencil, place a ¸ in each box to indicate how
well you know and understand each Key Term. q I know and understand this Key Term.
q I am still a bit uncertain about what this Key Term means. q I don’t understand this Key Term yet.
When you revise each chapter, tick the boxes again to indicate how much you have learned.
1. 2. 3. 4. 5. 6. 7. 8.
352 352
Market demand refers to people’s willingness to buy a product or service at a particular price and at a particular time. q q q
A demand curve is a graph showing the quantity of a product demanded by customers at different prices.
Substitute goods are goods which are easily swapped with each other for the same use.
Complementary goods are products that are often purchased and used together.
Disposable income refers to how much money consumers have available to spend after taxes are paid.
A supply curve is a graph showing the quantity of a product sellers are willing to supply at different prices.
q q q q q q q q q q q q
Market supply refers to the quantities of a product that sellers are willing to make available to buyers at a given price and time. q q q
q q q
Subsidies are fi nancial supports (e.g. grants or tax incentives) given by the government to groups of people or businesses. q q q
