UAE SOCIAL STUDIES - SUPPLY AND DEMAND

GRADE 4
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Supply is the amount of goods available.

Demand is the amount of goods and services people want to buy.

For example, in the above picture, there is a long queue outside the store.
It means that this Apple product is much in demand.

Scarcity means shortage or not having enough of resources for everyone

who wants to buy it.

The price of goods depends on supply and demand.

If the supply of a good increases, price will fall. Here the good is no longer
scarce.
If the supply of a good increases and the demand for it decreases, then
price will be lower than usual.

For example, An iphone 5 doesn’t have much demand now. Hence even if
supply is there, its price will be less.

Sale is a period during which a shop or dealer sells goods at reduced

prices. Both seller and customer benefit from a sale. Supply and demand is
the main reason behind a sale.

A store may have a shirt that few people wanted to buy at the price they
are asking. That means that the demand for the shirt is low at that price.
The store might reduce the price to get more people to buy the shirt.
The store lowers the price to try to increase the demand for the shirt.

Sometimes stores attract customers by adding ‘limited quantities’ to the

sale advertisements. This is to make people feel that they must hurry
before they miss the deal.
Another way to get customers to come to the store, is making offers or
coupons. For example, an offer could be “buy one pizza, get one free.”
The reason for this sale may be the expiry date on some of the food items
like pizza sauce. If the food item expires, then the store will lose the
opportunity to make money from it. Offering two for one, helps the
producer sell the goods.

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