The following table lists several individuals willingness to pay for archery les

Question

The following table lists several individuals willingness to pay for archery lessons and price various instructions are willing to accept: Throughout the lesson assume that each instructor can only serve one customer and each consumer of archery lessons requires only one lesson. Graph a supply and demand chart based off of the price and quanity of the lessons. I don't understand how to do that based off of these numbers?

Willingness to Pay Willingness to Accept

Amanda $70 David $70

Samantha $60 Chris $60

Helen $55 Matt $55

Joya $45 Steve $45

Stephanie $40 Jeff $40

Jenni $30 Michael $30

Victoria $25 Jay $25

Erin $15 Tony $15

Theresa $10 Victor $10

Explanation / Answer

Jackie,
You should come up with something like above. Let me explain how I got that.

A few things to remember with supply and demand is that with demand as the price of the lessons goes up, less people are gonna be willing to pay for that and the amount of lessons decreases and vice versa. If the price goes down, then more people are willing to take lessons. On the other hand, for the supply curve as the price goes up more tennis instructors want to give lessons because they'll make more money. Eventually, there will come an equilibrium price where the amount that customers are willing to pay will jive with what instructors are willing to accept for their lessons.

Okay, taking that into consideration, here is how you set it up your supply and demand curves:

1. The people that fall under "Willingness to Pay" are the people that will make up your demand chart or curve. This line will go diagonally down (marked Demand above). If we start with Amanda, she is willing to pay $70 for a lesson.

2. Now we move on to Samantha, she is willing to pay $60 but not $70 but more than likely Amanda would also pay $60 since she is willing to pay $70. So as you can see the number of people willing to pay that price for a lesson has increased to two. 

3. If we move on to Helen, she is willing to pay $55 for a lesson but I can bet that both Amanda and Samantha would bite on a lesson that is that price. So now the number of people willing to pay that price for the lesson has increased to three. If you continue on like that, you can see that as price goes down the quantity of lessons increases.

4. Now, move to your supply curve. The people that fall under "Willingness to Accept" are the people that will make up your supply curve. Remember too that the supply curve always goes up since as the price goes up suppliers (in this case tennis instructors) are willing to offer more lessons.

5. Let's start with Victor. He accepts $10 for a lesson. His price is in on the lower left hand corner on the supply curve above.

6. Now let's move on to Tony. He offers lessons at $15 but I am pretty sure that Victor would accept $15 for a lesson as well if someone offered it so now two people are willing to offer lessons at that price. 

7. If we move on to Jay, he offers lessons at $25 but if someone offered that price to both Tony and Victor they would accept it too so the people willing to accept at that price has moved to three. If you continue on like that, you can see that the amount of lessons goes up as well because as the price goes up more and more instructors are willing to take that price to offer a lesson.

Hope that helps.

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