Week 2 · Assignment: Traditional alternative (no AI)

Week 2 — Where Does the Price Settle? A Smoothie Market at a Night Market — Traditional alternative (no AI)

Introduction to Business Free sample edition

Traditional alternative (no AI), unpublished. In the course this is a separate assignment that ships unpublished beside the adaptive assignment: same objective, no AI. An instructor who prefers it publishes it and unpublishes or deletes the adaptive one, as the note at its top says.

Instructors: publish this instead of the adaptive version if you prefer, and unpublish or delete the adaptive one.

Assignment 2 of the term — read a supply-and-demand schedule, find a gap and a shift, and explain it to someone new to business.

This week you learned how a price settles where the amount buyers want matches the amount sellers offer, what a shortage and a surplus are, how one shift of demand moves the market, and how to place a business among the four market structures. In this assignment you read one small market's schedule, work two problems, interpret them, and explain the result to someone who has never studied business. This week's lecture tutorial, quiz, discussion, and Business Case Workshop practise the same ideas from other angles.

The task

The case is illustrative, built for this course and not real data. At a city's summer night market, several stands sell mango smoothies. On a normal evening, the smoothie market follows this schedule: at 3, 4, 5, 6, and 7 dollars a smoothie, buyers want 500, 420, 340, 260, and 180 smoothies, and the stands together offer 180, 260, 340, 420, and 500 smoothies. Like the coffee cart this course follows, each stand is a business: it aims to take in more money than it spends.

The same schedule, row by row:

At 3 dollars a smoothie: buyers want 500; the stands offer 180.
At 4 dollars a smoothie: buyers want 420; the stands offer 260.
At 5 dollars a smoothie: buyers want 340; the stands offer 340.
At 6 dollars a smoothie: buyers want 260; the stands offer 420.
At 7 dollars a smoothie: buyers want 180; the stands offer 500.

Work these two problems, showing every subtraction or addition:

On a normal evening, if every stand charges 4 dollars a smoothie, how many smoothies short is the market?
On a heat-wave evening, buyers want 160 more smoothies at every price. How many smoothies change hands at the new equilibrium?

Beside each answer, add a brief interpretation:

Problem 1: name the normal-evening equilibrium price and amount, say whether 4 dollars sits below or above it, and explain which way the price would tend to move and why. Then explain in a sentence why "the stands ran out" is not the best description of what happened at 4 dollars.
Problem 2: show the new amounts buyers want at every price, name the new equilibrium price, and say whether the heat wave is a shift of demand or a movement along the schedule, with a reason. Then place the smoothie stands in one of the four market structures, giving one reason each about the number of sellers, the products, and entry.

Explain it to a non-expert

A friend who helps at one of the stands asks you, "Why did the price go up on the hot night — were the stands being greedy?" Write a 3–5 sentence message that explains what changed on the hot night, what happened to the price and the amount sold, and one limit, including that the schedule is a classroom model and that this case is illustrative. Explain any technical term in everyday words. More than one good answer is possible, and the message gives no legal or financial advice.

For a different, ungraded example, imagine umbrellas sold outside a train station. Model answer: "When it started raining, more commuters wanted umbrellas at every price, so the sellers could not keep up at the old price. The price rose until the number people wanted matched the number on offer. That is the market finding a new balance, not a single seller deciding to be greedy. This is a simplified picture; real sellers also think about regular customers and goodwill."

Use that pattern for the smoothie market, with your own wording and evidence.

Show your work. A reader should be able to rebuild every amount you report from the schedule without guessing which rows you used.

Deliverables

Submit a single report containing:

the two answers, each with every subtraction or addition shown and the interpretation the task names for that problem;
your message to the friend, explaining what changed on the hot night, what happened to the price and the amount sold, and one limit; and
the heat-wave schedule, listing the new amount buyers want beside the amount the stands offer at every price, so your new equilibrium can be checked.

Keep it to roughly one page. Clear and correct beats long.

Choose how you show it. Present your report as written text, or as a recorded audio or video explanation of about three minutes with a transcript, or as a labelled sketch of the schedule as two lines with a short note. Every form is graded by the same scoring criteria. Submit in any accessible file type or as a link; a recorded response may be submitted as audio or video with a transcript, or as text.

How you'll be graded

The full analytic rubric is attached to this assignment in Canvas.

Academic integrity and AI use

This version is designed to be completed without AI: do the arithmetic, the interpretations, and the writing yourself, without a chatbot or other AI tool. You may use a free spreadsheet to lay out the schedule. Submitting AI-generated work as your own, or copying another student's work, is an integrity violation under the course policy.

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