Syllabus: OCR - GCSE Economics
Module: 2. The Role of Markets and Money
Lesson: 2.3 Supply

Introduction

Topic 2.3 of the OCR GCSE (9–1) Economics specification explores the concept of supply, forming a crucial part of the wider theme “The role of markets and money”. This section helps students understand how producers respond to price changes, what influences supply, and why elasticity matters. These ideas underpin many economic systems and provide a springboard to deeper analysis in later units. The content is fully syllabus aligned and prepares students for exam-style questions involving both written explanations and diagrams.

Key Concepts

By the end of this topic, learners should be able to:

• Define supply: the quantity of a good or service that producers are willing and able to sell at different prices in a given time period.

• Draw and interpret a supply curve using data, including individual and market supply.

• Differentiate between movements along and shifts of the supply curve:

  • Movement: change in quantity supplied due to a change in price.

  • Shift: change in supply due to factors other than price.

• Analyse causes and consequences of changes in supply:

  • Input costs (e.g. wages, raw materials)

  • Technological advances

  • Government policies (e.g. taxes, subsidies)

  • External shocks (e.g. weather, global events)

• Explain price elasticity of supply (PES):

  • Understand different elasticity types (inelastic, elastic)

  • Draw supply curves of differing elasticity

  • Evaluate how PES affects producer decisions and responses.

Real-World Relevance

Supply changes aren’t just theoretical — they affect prices and availability across the economy. A few live examples:

• UK energy prices rose sharply when gas supply was disrupted by geopolitical tensions, highlighting how supply shocks affect households and firms.

• Supermarket shortages during Brexit and COVID-19 illustrated how disrupted supply chains shift supply curves leftward, raising prices.

• The farming sector provides a seasonal case study: poor weather reduces crop yields, shifting the supply curve left and increasing prices for staples like wheat or vegetables.

These examples help students grasp how economic theory plays out on the news and in their day-to-day lives.

How It’s Assessed

OCR assessments use varied question types that test both conceptual understanding and applied reasoning:

• Command words include:

  • Explain: define and describe cause or effect clearly.

  • Analyse: link ideas together into a logical chain of reasoning.

  • Evaluate: weigh up impacts or alternative actions and provide a justified conclusion.

• Typical questions might ask students to:

  • Draw and interpret supply curves.

  • Identify factors that shift supply and assess impacts.

  • Compare elastic vs. inelastic supply and evaluate implications.

• Assessment format: mixture of multiple-choice, short-answer, and extended response questions, often linked to real-world or data-based scenarios.

Enterprise Skills Integration

Understanding supply isn’t just about diagrams — it develops real skills:

• Problem-solving: Students explore how producers adapt to rising costs or policy changes.

• Decision-making: Analysing PES helps learners think critically about responsiveness and planning under uncertainty.

• Data literacy: Drawing and interpreting supply curves builds fluency in working with quantitative information.

Enterprise Skills’ business simulations reinforce these capabilities by giving students hands-on practice managing supply scenarios in a competitive virtual market.

Careers Links

Supply concepts map directly to several real-world roles:

• Logistics and operations managers use supply forecasts to balance inventory and demand.

• Retail buyers consider PES when sourcing products — knowing how fast supply can ramp up is vital.

• Economists and analysts predict how market events (e.g. strikes, raw material price hikes) affect supply chains.

This topic supports Gatsby Benchmarks 4 (Linking curriculum to careers), 5 (Employer encounters), and 6 (Workplace experience), especially when paired with Enterprise Skills’ simulation sessions or case study-based lessons.

Teaching Notes

Here’s what to keep in mind when planning lessons:

• Use real data: Supermarket prices, farming outputs, or tech launches help students visualise how supply shifts happen.

• Link to demand: Many students conflate the two, so reinforce that supply is producer-focused and responds differently.

• Common misconceptions:

  • That supply always increases with price — not true when firms hit capacity limits.

  • Confusing PES with PED — the context (consumer vs. producer) must be made explicit.

• Classroom activity ideas:

  • Run a “price change simulation” where students act as producers and react to news headlines (e.g. tax hike, bad weather).

  • Use Enterprise Skills’ digital tools to reinforce elasticity concepts with real-time decision-making.