Chapter 2 - Competitive Markets Flashcards
(29 cards)
Sub-market
A recognised or distinguishable part of a market. Also known as a market segment.
Market
Where or when buyers and sellers meet to trade or exchange products
Demand
The quantity of a product that consumers are able and willing to purchase at various prices over a period of time
Notional demand
The desire for a product
Effective demand
The willingness and ability to buy a product
Ceteris paribus
Assuming other variables remain unchanged
Demand curve
This shows the relationship between the quantity demanded and the price of a product
Demand schedule
The data that is used to draw the demand curve for a product
Movement along the demand curve
This is in response to a change in the price of a product
Consumer surplus
The extra amount that a consumer is willing to pay for a product above the price that is actually paid
Disposable income
Income after taxes on income have been deducted and state benefits have been added
Real disposable income
Disposable income and result has been adjusted to take into account changed in the price level
Normal goods
Goods for which an increase in income leads to an increase in demand
Inferior goods
Goods for which an increase in income leads to a fall in demand
Substitutes
Competing goods
Complements
Goods for which there is joint demand
Change in demand
This is where a change in a non-price factor leads to an increase or decrease in demand for a product
Supply
The quantity of a product that producers are willing and able to provide at different market prices over a period of time
Profit
The difference between the total revenue of a producer and cost
Supply curve
This shows the relationship between the quantity supplied and the price of a product
Supply schedule
The data used to draw up the supply curve of a product
Producer surplus
The difference between the price a producer is willing to accept and what is actually paid
Change in supply
Occurs when a change in a non-price influence leads to an increase or decrease in the willingness of a producer to supply a product
Price
The amount of money that is paid for a given amount of a particular good or service
