1140 Definitions

Question 1

study of how the competitive market system operates

Answer 1

price theory

Question 2

basic to the incentive structure of an economy

Answer 2

scarcity

Question 3

grown, mined, or manufactured commodities

Answer 3

goods

Question 4

activities performed for others

Answer 4

services

Question 5

based on the value of components, scarcity, and labor

Answer 5

intrinsic value

Question 6

based on the consumer’s idea of a product’s usefulness

Answer 6

subjective value

Question 7

ultimate arbiters of economic decisions

Answer 7

consumer preferences

Question 8

consumer satisfaction received from a good or service

Answer 8

utility

Question 9

decrease in satisfaction provided by each additional unit of a good or service

Answer 9

diminishing marginal utility

Question 10

satisfaction derived from the consumption of one unit of a good

Answer 10

marginal utility

Question 11

an expression of value in terms of money

Answer 11

price

Question 12

The desire for a good or service coupled with the ability and willingness to purchase it

Answer 12

Demand

Question 13

The law of demand:

Answer 13

The lower the price, the greater the demand

Question 14

is the primary factor in determining supply

Answer 14

cost

Question 15

is determined by the combination of supply and demand

Answer 15

market price