Lesson 49

After the War - Supply and Demand: An Economics Lesson in Cleveland, 1946

OBJECTIVE:

Students will define the terms supply, demand and scarcity and the effects upon the production of goods and services. Students will understand how the scarcity of certain consumer goods affected Clevelanders in 1946

INSTRUCTIONAL MATERIALS:

• Fact Sheet
• Supply and Demand
• Newspaper Articles on Shortages
• Political Cartoon from 1946
• Cartoon Analysis Worksheet
• Demonstration materials: 10 pennies for each student, wrapped hard candy for each student
  

TERMS:

supply, demand, scarcity, OPA

LESSON FOCUS:

1. What was life like in Cleveland immediately following WWII?
2. How did the shortage of some consumer products affect Clevelanders?
3. How did the laws of supply and demand and scarcity affect some consumer products after World War II? What were some of the products affected?

TEACHING PROCEDURES:

1. This demonstration can be done with pennies and candy, or pencils or home work passes, etc. You can also use "play" money instead of pennies, just make certain that the items are of some value to the students.
   

   Distribute 10 pennies to each student.
   

   Display a bag of wrapped hard candy (enough for one for each student) on a table before the class, and announce how many pieces you have. Ask students how much they would be willing to pay for one piece of the candy? When an agreed upon price is reached, write that price on the board.
   

   Announce to the students that you "forgot" that you promised a special surprise for your next period class and to be fair, you can really only sell 1/2 of the amount of candy you have here. (Remove 1/2 of the candy to another bag) Now ask students how much they would be willing to pay for one piece of candy? Be certain that you "play" the game well and lead students to a higher price. Why should you sell your candy now for the same price? Isn't it worth more now? etc. (The agreed upon price should be higher than they were willing to pay during the first round)
   

   Analyze the demonstration with the students. What happened to the prices? Why were they willing to pay more for one piece during the second round? Why did you, the supplier feel you could ask for more money per piece of candy. Be certain to use the terms of supply and demand and scarcity.
   

   Now tell the students that in all fairness, you really cannot charge them more for the candy than what you paid for it, so a price limit is set at 2 cents each. How many students would like to buy a piece now? Point out that there are now more buyers than pieces of candy. What should be done? How can the candy be distributed fairly? Let students brainstorm on the problem for a while. Then pose another problem to them. What would happen if the teacher was told that she/he could not sell any candy under any circumstances to the students. He would have to give it away. "Play" the part of deciding to not bother with buying candy at all because you don't have any way of recuperating your costs. What happens to the supply of candy?
   

   At the end of discussion and the demonstration, you may go around the room, collect ten pennies from each student and distribute a piece of candy in return.

2. Once students have had the opportunity to understand and define supply, demand, and scarcity, explain to them that this is a situation that occurs in our economy throughout history. Share with the class information in the Fact Sheet about Cleveland during and after WWII. Distribute the newspaper readings to the class. This could be done as a group activity with each group doing only one reading and then sharing their findings with the rest of the class. As students read the articles they should:
   

   1. Define the item that is scarce or rationed.
   2. Identify what consumer group is affected by the shortage.
   3. What has caused that item to be in short supply?
   4. What problems have been caused by the shortage of the item?
   5. What solutions to the problem are offered in the article?

3. As groups share their articles, begin listing the items and information on the board. Discuss the problems and brainstorm possible solutions.

4. Show the students Political Cartoon #1. Discuss the cartoon and its meaning. You may use the Cartoon Analysis Worksheet for this activity. What is the setting? (A restaurant) Who are the characters and what do they represent? (an American family, and the President of the United States) Be certain to identify the item of scarcity (meat), Who is serving (President Truman) the meaning of the OPA bone (price controls stripping meat to the bone) and "peace, production and progress" (pledges for after the war)

5. Ask students to brainstorm on what they consider important issues of today. Have them identify the problem, causes, who it affects, how it could be solved and then have them create their own political cartoon. It would be of particular interest if they could identify an issue important to Cleveland for this activity. Have students share their cartoons with the rest of the class. These can then be displayed.