Chapter 3 Vocabulary Terms- Micro

Description

All of the important terms in Chapter 3 defined- micro.
Olivia t
Flashcards by Olivia t, updated more than 1 year ago
Olivia t
Created by Olivia t about 5 years ago
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Question Answer
amount of a good or service that a customer is willing and able to purchase at a given price quantity demanded
a good for which the demand increases as income falls and decreases as income rises inferior good
requirement that when analyzing the relationship between two variables (like price and quantity demanded) other variables must be held constant. ceteris paribus condition
positive/negative change in the ability of a firm to produce a given level of output with a given quantity of inputs technological change
a situation in which quantity demanded equals quantity supplied market equilibrium
table that shows the relatinoship between the price of a produce and quantity of the product demanded demand schedule
goods and services that can be used for the same purpose subsitutes
a situation in which the quantity demanded is greater than the quantity supplied shortage
change in 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 subsitutes substitution effect
the rule that, holding all else constant, when price of a product falls, the quantity demanded of the product will increase and when the price of a product rises the quantity demanded of the product will decrease law of demand
a curve that shows the relationship between the price of a product and the quantity of the product demanded demand curve
a market equilibrium with many buyters and sellers competetitive market equilibrium
a good for which the demand increases as income rises and decreases as income falls normal good
a table that shows the relationship between the price of a product and the quantity of the product supplied supply schedule
a market that has: 1. many buyers and sellers 2. all firms are selling identical products 3. no barriers to new firms entering the market perfectly competetitive market
demand by all the consumers of a given good or service market demand
the rule that, holding all else constant, increase in price causes increases in the quantity supplied and decreases in price causes decreases in the quantity supplied law of supply
a situation in which the quantity supplied is greater than the quantity demanded surplus
a curve that shows the relationship between the price of a product and the quantity of the product supplied supply curve
the amount of a good or service that a firm is willing and able to supply at a given price quantity supplied
goods and services that are used together complements
the change in quantity demanded of a good that results from the effect of a change in the good's price on consumers' purchasing power income effect
characteristics of a population with respect to age, gender, and race. demographics
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