The Discussion in M3 focused on analyzing Supply and Demand curves. In addition to graphs, a table or "schedule" could also be used to illustrate Supply and Demand.

Look at the table below. How do these numbers illustrate the Law of Supply and the Law of Demand? Are they consistent with a downward sloping demand curve and an upward-sloping supply curve? Explain.

Using the table, what would be equilibrium price and quantity in the market represented by this table? How did you find that answer?

Table showing Price and Quantities of Cones Demanded and Supplied

Price of Ice Number of Number of

Cream Cone Cones Demanded Cones Supplied

$2.00 70 cones 30 cones

$3.00. 60 cones 40 cones

$4.00. 50 cones. 50 cones

$5.00 60 cones 40 cones

$6.00 70 cones. 50 cones

$7.00 80 cones 60 cones

$8.00 90 cones 50 cones

Next, assume that Demand increases so that the quantity demanded is now 20 cones higher at each price. It may help to construct a new column for demand on scratch paper. What are the new equilibrium price and quantity? In detail, compare this result with what would happen if this increase in demand was shown graphically instead of with a table.

Now assume that simultaneously, in addition to the higher Demand mentioned above, the quantity supplied is also 20 cones higher at each price. Now, what would be the new equilibrium price and quantity? Explain the difference when supply is also increasing, and what this would look like in a graph.