Commerce - unit 2 Flashcards
Define supply
the amount of a good or service that producers are willing and able to offer for sale at different prices over a certain period of time
State the Law of Supply
as the price of a good or service increases, the quantity supplied also increases, and as the price decreases, the quantity supplied decreases
What causes a movement along the supply and demand curve
a change in the price
State FIVE factors that may cause this increase in supply.
Production cost
Technology improvements
Number of producers changes
Indirect tax is added
Resource availability changes
Define demand
refers to the quantity of a good or service that consumers are willing and able to purchase at various prices over a certain period of time
State the Law of Demand
states that as the price of a good or service decreases, the quantity demanded by consumers increases, and as the price increases, the quantity demanded decreases
State FIVE factors that may cause this increase in demand.
Population
preferences
Price of substitutes
direct tax
Seasonal
What does direct tax affect?
Income tax which is demand
What does indirect tax affect?
other taxes which is supply
What is a subsidy?
A payment from the government to the producer to cover part of the cost of production.
What is producer spending the same as and how do you calculate it
producer revenue, and p x q
What is the immediate effect and what should you write after
the immediate effect is saying weather the price and quantity increased or decreased, afterwards state a follow on effect
