Plotting the supply and demand curves in class using live data collected from students

The equilibrium price is one of the key ideas that a student has to understand if he/she were to appreciate pricing. This week, I am going to be dealing with the topic of pricing in my class, and I thought it would be a great idea to start by making them generate the data to plot the supply and demand curves, and showing them how the equilibrium price emerges from this.

This is how I plan to organize my class:

• At the start of my class I shall be dividing my class into two sections (buyers, and sellers). Each section would then be put in a waiting room (in Zoom) so that they do not communicate with each other.
• For the set of all buyers – I shall ask them to imagine themselves in a desert and very thirsty. I will then tell them that there is a water bottle sales man (each bottle is 500 ml) who is willing to sell bottles of water to him/her. I shall also add that there are others who are interested in buying water from the sales man. And then, ask them to answer the following questions.
• How many bottles of water would you buy if a bottle costs Rs. 100/-,  Rs. 90/-, Rs. 80/- and so on until Rs. 20/-  (I plan to implement this using a simple google form)

Preview of the Google Form (demand curve) I intend to float in class

• For the sellers section of class, I shall explain the same context, but put them in the role of the water bottle sales man. I shall ask them to answer the following questions.
• How many bottles of water are you willing to supply at Rs. 10/- per bottle, Rs. 20/- per bottle, and so on until Rs. 100/- per bottle.

Preview of the Google Form (supply curve) I intend to float in class

• My thinking is that each of the students would intuitively generate the curve (also the students in my class have already attended micro economics class, so they will be knowing what I am trying to do). I also believe that this will help spark some conversations after class that will lead them to some more learning.
• After the students complete filling up their respective forms, I shall get them together in the zoom class and ask them a few questions about what they think would happen. I really look forward to listening to their thoughts on this subject.
• I have already written down the R code (found here: Generating Equilibrium price.Rmd – Google Drive) to plot the supply and demand curve in class. To get the demand side and supply side data, I generate the average quantity demanded at each price and and average quantity the supplier is willing to supply. I think the exercise will throw up some nice plots. Would be interesting to see.

The empty chart- Waiting to be filled up.

Not sure how this exercise will play out in class. But the post activity plan for class is to try and show the students how different economic logics of pricing work with the desert scenario as an example. I plan to use the Tellis (1986) paper which I have recommended as a prerequisite reading for the class. Hope this goes well!!

Happy teaching!

Special note:

• I used the google drive link to ensure that the most up to date version of the R code is with you
• I would ABSOLUTELY love to hear back from you. The very idea behind starting to document my teaching is to connect with others, get high quality feedback, learn from them and most importantly, share my curious!