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S. Y. 2021 – 2022

LEARNING ACTIVITY SHEET NO. 2

First Semester (Midterms) – Applied Economics 12

Name: _________________________________________ Grade and Section: __________________

Timeline: _______________________________________ To be submitted on: __________________

Topic: APPLICATION OF DEMAND AND SUPPLY

Learning Competency/ies: At the end of this lesson, you will be able to analyse market demand, market
supply and market equilibrium.

DAY 1
Topic: Basic Principles of Demand and Supply

Concept:
A market is an interaction between buyers and sellers of trading or exchange. It is where the consumer
buys and the seller sells. The goods market is the most common type of market because it is where we buy
consumer goods. The labor market is where workers offer services and look for jobs, and where employers
look for workers to hire. There is also the financial market which includes the stock market where securities of
corporation traded. Did you know that market is important because it is where a person who has excess goods
can dispose them to those who need them.
Demand is the willingness of a consumer to buy a commodity at a given price. A demand schedule
shows the various quantities the consumer is willing to buy at various prices. Demand shows us the side of the
consumers and their reactions to changes in price and other determinats. We now look at the side of the
supplier.
To understand the supply and demand, read your hand outs entitled “Supply and Demand”.

Activity:
A. Using the following demand function, solve for the demand schedule of Robert given the following
prices for bottled water. Qd=60 – P/2

Price (P) Quantity Demanded (Qd)

P0
2
4
6
8
10
12
14
16

Based on this schedule, construct a demand curve for Robert.

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 B. Using the following supply function, solve for the supply schedule for Robert, a seller of bottled water in
the market, the supply function is given as Qs=5 + 5P.

Price (P) Quantity Supplied (Qs)

P0
2
4
6
8
10
12
14
16

Based on this schedule, construct a supply curve for Robert.

Processing Question:
 Discuss and explain the factors that affect the demand and supply.

DAY 2
Topic: Market Equilibrium

Concept:
If the forces of demand and supply operate together, we can show how price is determined in a market
economy. Alfred Marshall, a British economist, defined the law of Demand and Supply.
Equilibrium is a state of balance when demand is equal to supply. The quality means that the quantity that
sellers are willing to sell is also quantity that buyers are willing to buy for a price.
Read and study your hand outs entitled “Market Equilibrium”.

Activity:
Based on the activities above, construct the supply and demand curves for bottled water. Identify equilibrium
price and quantity.

Supply and Demand Curve

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Reflection:
How does COVID – 19 affect the demand and supply chains of the products in the Philippines?

References:
 Rosemary P. Dinio, PhD, George A. Villasis (2017)), Applied Economics, Teacher’s Resource Material,
First Edition, Rex Book Store, Inc. (RSBI)
 Rosemary P. Dinio, PhD, George A. Villasis (2017)), Applied Economics, First Edition, Rex Book Store,
Inc. (RSBI)

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