Economics Project 2/Change in Supply Activity 

Economics Project 2/Change in Supply Activity 

 

Economics Project 2/Change in Supply Activity

 

Directions: A smart business owner knows that when a determinant of supply changes, then the business owner must adjust his or her level of supply. Changing the price of your good is not an option. Make decisions based on the following scenarios so that you can continue to grow your business. Then after you have made the decision, first identify your reason (GETS TIPS), and justify your reasoning in a brief sentence. Then, create an economic model of your choice by graphing the change in supply. Use the knowledge gained from the Change in Supply Notes, the video, and the models above to help you correctly graph your decision. If you make the right decisions, your business will grow exponentially and you will be more successful. Beware: if you make the wrong decisions, you run the risk of having to close your business. When you have completed the activity, click on the Activity Submission tab, then the Activities tab; open the Change in Supply Activity, and follow the instructions to submit your work.
Scenario #1It is the end of a fiscal (financial) year, and you are about to receive the new inventory for the next year. You need to make room by selling off your current product before the end of the year, and the new inventory arrives.
How will you change your supply to accommodate this event?(Identify and justify your reaction here in a brief sentence.)

Graph the change in supply.(To draw a line on the graph click insert, then shapes, then choose line. Place your cursor on the graph, and drag it until you get the length you want. To add words, click insert, then Text Box. Draw the box on the graph, and add the text.)
Scenario #2Your industry has been engaged in a nationwide labor dispute. After many months, the unions have negotiated a pay increase across the board in exchange for less paid vacation time. After all is said and done, this event will increase your labor costs by 1%. Remember, you cannot just increase your price to cover the additional cost.
How will you change your supply to accommodate this event?(Identify and justify your reaction here in a brief sentence.)
Graph the change in supply. Scenario #3Congress passes a bill providing tax incentives (tax breaks) for all small business owners, but increases tax rates for all multi-million dollar corporations to increase government revenue.How will you change your supply to accommodate this event?(Identify and justify your reaction here in a brief sentence.)

Graph the change in supply.Scenario #4One of your competitors in your market goes out of business.How will you change your supply to accommodate this event?(Identify and justify your reaction here in a brief sentence.)

Graph the change in supply. Scenario #5During the mid-term elections, a more pro-active Congress is elected. Immediately, the new Congress pushes through new measures to increase government intervention in business interactions by toughening up safety regulations, health codes, environmental controls, and consumer protections laws.
How will you change your supply to accommodate this event?(Identify and justify your reaction here in a brief sentence.)

Graph the change in supply.
Scenario #6Great news!! You have paid off your small business loan. It is an exciting day because that is one less bill you have to pay every month, and you now own your business outright. The bank no longer has any claim to your property.
How will you change your supply to accommodate this event?(Identify and justify your reaction here in a brief sentence.)

Graph the change in supply.
Scenario #7You have hired an efficiency expert to help reorganized your labor force and increase productivity. She has the magic touch and whips your labor into shape!
How will you change your supply to accommodate this event? (Identify and justify your reaction here in a brief sentence.)

Graph the change in supply.
Grading Rubric:20 points:All seven scenarios answered and graphed correctly.  This means you have made smart business decisions and have used your economics skills wisely. Exponential business growth occurs.  16-19 points: Five to six scenarios answered and graphed correctly. You are still making smart business decisions with only minor missteps. Healthy business growth occurs.13-15 points:Four to five scenarios answered and graphed correctly. For the most part, you are making smart business decisions with some missteps. Good business growth occurs.10-12 points:Three to four scenarios answered and graphed correctly. You are making some smart business decisions with some major missteps. Some business growth occurs, but it could be better.Less than 10 points:Fewer than three scenarios answered and graphed correctly. You are struggling to make smart business decisions and have had major missteps. Very little business growth occurs and you are risking business closure.

 

 

business decisions are made by one person  company liability is limited by a special contract  business owners are not responsible for the debts of the company  most likely to end with a disagreement between the owners over business decisions  business organization with the most unlimited liability  70% of all businesses  business issues stock to increase capital  90% of all business sales  business organization with the most limited life  business organization that is a legal entity and is viewed as an “artificial person”A. sole proprietorshipB. corporationC. partnership