Terms : Hide Images
| 8754571001 | market | a group of buyers and sellers of a particular good or service. | 0 | |
| 8754571002 | competitive market | a market in which there are so many buyers and so many sellers that each has a negligible impact on the market price. | 1 | |
| 8754571003 | quantity demanded | the amount of a good that buyers are willing and able to purchase. | 2 | |
| 8754571004 | law of demand | the claim that, other things being equal, the quantity demanded of a good falls when the price of the good rises. | 3 | |
| 8754571005 | demand schedule | a table that shows the relationship between the price of a good and the quantity demanded. | 4 | |
| 8754571006 | demand curve | a graph of the relationship between the price of a good and the quantity demanded. the demand curve is downward sloping, reflecting the law of demand. | 5 | |
| 8754571007 | normal good | a good for which, other things equal, an increase in income leads to an increase in demand. | 6 | |
| 8754571008 | inferior good | a good for which, other things equal, an increase in income leads to a decrease in demand. | 7 | |
| 8754571009 | substitute goods | two goods for which an increase in the price of one good leads to an increase in the demand for the other. | 8 | |
| 8754571010 | complementary goods | two goods for which an increase in the price of one good leads to a decrease in the demand for the other. | 9 | |
| 8754571011 | quantity supplied | the amount of a good that sellers are willing and able to sell. | 10 | |
| 8754571012 | law of supply | the claim that, other things equal, the quantity supplied of a good rises when the price of the good rises. | 11 | |
| 8754571013 | supply schedule | a table that shows the relationship between the price of a good and the quantity supplied. | 12 | |
| 8754571014 | supply curve | a graph of the relationship between the price of a good and the quantity supplied. the supply curve is upward sloping, reflecting the law of supply. | 13 | |
| 8754571015 | equilibrium | a situation in which the market price has reached the level at which quantity supplied equals quantity demanded. | 14 | |
| 8754571016 | equilibrium price | the price that balances quantity supplied and quantity demanded. | 15 | |
| 8754571017 | equilibrium quantity | the quantity supplied and the quantity demanded at the equilibrium price. | 16 | |
| 8754571018 | Surplus | also known as excess supply, a surplus exists at a market price when the quantity supplied exceeds the quantity demanded. the price falls to eliminate a surplus. | 17 | |
| 8754571019 | Shortage | also known as excess demand, a shortage exists at a market price when the quantity demanded exceeds the quantity supplied. the price rises to eliminate a shortage. | 18 | |
| 8754571020 | law of supply and demand | the claim that the price of any good adjusts to bring the supply and demand for that good into balance. | 19 | |
| 12258930214 | all else equal | to predict how a change in one variable affects a second, we hold all other variables constant. This is also referred to as the "ceteris paribus" assumption. | 20 | |
| 12258933030 | Absolute (or money) prices | The price of a good measured in units of currency | 21 | |
| 12258935945 | relative prices | the number of units of any other good Y that must be sacrificed to acquire the first good X. Only relative prices matter. | 22 | |
| 12258937353 | substitution effect | the change in the quantity demanded of a good that results from a change in price, making the good more or less expensive relative to other goods that are substitutes | 23 | |
| 12258942347 | income effect | the change in the quantity demanded of a good that results from the effect of a change in the good's price on consumers' purchasing power | 24 | |
| 12258948429 | Determinants of Demand | the external factors that shift demand to the left or right | 25 | |
| 12258951131 | Determinants of Supply | one of the external factors that influences supply. When these variables change, the entire supply curve shifts to the left or right | 26 | |
| 12258958176 | market equilibrium | Exists at the point where the quantity supplied equals the quantity demanded. Or, it is the only quantity where the price consumers are willing to pay is exactly the price producers are willing to accept. | 27 | |
| 12258970611 | Disequilibrium | Occurs when quantity demanded and quantity supplied are not in balance | 28 | |
| 12258974990 | Total Welfare | the sum of consumer surplus and producer surplus. The free market equilibrium provides maximum combined gain to society. | 29 | |
| 12258983285 | Consumer Surplus (CS) | Difference between how much people are willing to pay and the price they do pay. It is the area below the demand curve and above the price. | 30 | |
| 12258992924 | Producer Surplus (PS) | the difference between the amount for which a good sells and the minimum amount necessary for the seller to be willing to produce the good. It is the area above the supply curve and under the price. | 31 |
