Supply and Demand Facts & Worksheets | Economics for Kids - Free Printable

Problem Analysis and Solution

The task involves analyzing how changes in the price of commodities affect the quantity demanded (Qd). The general principle to remember is:

- Law of Demand: As the price of a commodity decreases, the quantity demanded increases. Conversely, as the price increases, the quantity demanded decreases.

We will analyze each scenario step by step and determine whether the change in price will cause an increase ("UP") or decrease ("DOWN") in the quantity demanded (Qd).

---

1. The retail price for mango gradually decreased up ¼ of its previous market price.

- Explanation: When the price of mango decreases, it becomes more affordable for consumers. As a result, more people are likely to buy mangoes, leading to an increase in the quantity demanded.
- Answer: UP
- Reasoning: Lower prices encourage higher demand due to affordability.

---

2. The retail price for red onions has increased by ¼ of its previous market price.

- Explanation: When the price of red onions increases, they become less affordable for consumers. As a result, fewer people are likely to buy red onions, leading to a decrease in the quantity demanded.
- Answer: DOWN
- Reasoning: Higher prices discourage demand due to reduced affordability.

---

3. The price of a pair of branded rubber shoes is marked down to 50% of its original price.

- Explanation: A significant price reduction (50%) makes branded rubber shoes much more affordable. This affordability encourages more consumers to purchase them, leading to an increase in the quantity demanded.
- Answer: UP
- Reasoning: Large discounts attract more buyers, increasing demand.

---

4. The market price of sweetened peanut butter has doubled compared to its retail price in the previous months.

- Explanation: A doubling of the price means that sweetened peanut butter has become significantly more expensive. This high price will deter many consumers from buying it, leading to a decrease in the quantity demanded.
- Answer: DOWN
- Reasoning: Extremely high prices reduce demand as consumers may seek alternatives or cut back on purchases.

---

5. The cost of a children's stationery set is marked up after the back-to-school sale.

- Explanation: After a sale, marking up the price of a children's stationery set makes it more expensive for consumers. This increase in price will likely lead to a decrease in the quantity demanded, as parents may choose cheaper alternatives or delay purchases.
- Answer: DOWN
- Reasoning: Price increases post-sale discourage demand as consumers may find the product less attractive.

---

Final Answers with Explanations

1. The retail price for mango gradually decreased up ¼ of its previous market price.
- Answer: UP
- Explanation: Lower prices make mango more affordable, increasing demand.

2. The retail price for red onions has increased by ¼ of its previous market price.
- Answer: DOWN
- Explanation: Higher prices make red onions less affordable, decreasing demand.

3. The price of a pair of branded rubber shoes is marked down to 50% of its original price.
- Answer: UP
- Explanation: A 50% discount makes branded rubber shoes very affordable, increasing demand.

4. The market price of sweetened peanut butter has doubled compared to its retail price in the previous months.
- Answer: DOWN
- Explanation: Doubling the price makes sweetened peanut butter too expensive, decreasing demand.

5. The cost of a children's stationery set is marked up after the back-to-school sale.
- Answer: DOWN
- Explanation: Marking up the price after a sale makes the stationery set less attractive, decreasing demand.

---

Summary Table

| Scenario | Answer | Explanation |
|--------------------------------------------------------------------------|--------|-----------------------------------------------------------------------------|
| 1. Mango price decreased by ¼ | UP | Lower prices increase demand due to affordability. |
| 2. Red onion price increased by ¼ | DOWN | Higher prices decrease demand due to reduced affordability. |
| 3. Branded rubber shoes price marked down to 50% | UP | Significant discount increases demand due to affordability. |
| 4. Sweetened peanut butter price doubled | DOWN | High prices decrease demand as consumers seek alternatives. |
| 5. Children's stationery set price marked up after sale | DOWN | Price increase after sale discourages demand. |

---

Final Answer:
\boxed{
\begin{array}{c|c}
\text{Scenario} & \text{Answer} \\
\hline
1. \text{Mango price decreased by } \frac{1}{4} & \text{UP} \\
2. \text{Red onion price increased by } \frac{1}{4} & \text{DOWN} \\
3. \text{Branded rubber shoes price marked down to 50\%} & \text{UP} \\
4. \text{Sweetened peanut butter price doubled} & \text{DOWN} \\
5. \text{Children's stationery set price marked up after sale} & \text{DOWN} \\
\end{array}
}